The 3500 is said to produce higher quality burns, however, keep in mind that burn quality varies greatly with different media. The 3520 on the other hand can do PI/PIF scanning, that’s something the 3500 can’t do (…yet, it is expected that this feature will be added to the 3500 in the near future).
I doubt if much can be said about the reliability of both drives. Some people did 500+ burns with their drive without any decrease in performance, others had drives that were dead only a few weeks after they purchased it. It is a matter of personal experience. I for example will never buy Philips again, but there are plenty of people that enjoy owning one of their drives.
At the moment I’m considering buying a new drive and still haven’t chosen between the 3500, 3520 and the 3540 yet (I’m also considering a Benq). But if I were to buy a new one right now, it would be a 3520, since it can produce good burns and it can do PI/PIF scanning.