"Oookay! 2.2 (Froyo) will be rolled out for the Samsung Galaxy s in australia this month/next month sometime. So i'll wait till then.."
my Galaxy S is with Optus - they gave me notification sms with link to optus online which then gave me a link to Samsung Australia website's Androis 2.2 upgrade a few weeks back. (link below)
my Kies had stopped functioning also after i'f tried upgrading it from the Samsung site so i uninstalled it and re-installed it from the link on the Samsung upgrade page. It seems to now work perfectly except tha soem warnning pops up everytime o load it saying some thong about usb not functioning??. Using Kies the upgrade to Android 2.2 went flawlessly ...
goodluck and hope this helps
Samsung Galaxy S - Phone Firmware Update - Support - Samsung Mobile Australia