I can see firefox 3.6.16 in Applications on my Mac but from the top bar the dropdown Firefox menu says I have 3.6.10. What do I do to run and use 3.16.3?

If I can see 3 6 16 it means I assume I have downloaded it but the fact that I am not running it means what? That I havent installed it? How do i now install it? Must be simple.

You appear to have Firefox 3.6.10 installed and in use, so therefore presumably on your hdd.
Without upgrading to the newest major version firefox 4, the latest version available is Firefox 3.6.16 , with Firefox 3.6.17 being the next one; scheduled I believe, for 26th April. So to be up-to-date with Firefox 3.6 you should be trying to upgrade to 3.6.16, which I understand you have already downloaded.
First of all try an automatic upgrade by using:
* Help -> Check for upgrades
* as explained here : [[Updating Firefox]]
* if you have problems the link I provided earlier may help [[software update failed]]
If you are unable to get the upgrade to work you can always just do an install of Firefox 3.6.16. BUT please do NOT use the option that says something along the lines of remove settings, if you do you are likely to loose important stored information, including passwords and bookmarks.
* see [[installing firefox on mac]]

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