Personal Hotspot feature that is present in the iOS 4.3 software update will only support three WiFi devices. However, you can merge two more devices as well via Bluetooth and USB connectivity.
According to the Engadget, they have posted the AT&T iOS 4.3 document in which it is clearly written that the usage of Personal Hotspot (mobile hotspot will be restricted to only 3 Wi-FI devices. Where else, another update is shared below from the Apple’s official iOs 4.3 page.
On the road, in an airport, at the park — now you can bring Wi-Fi with you wherever you go. Download iOS 4.3 on your iPhone 4, and the next time you find yourself without access to Wi-Fi but in 3G territory, enable Personal Hotspot and share your cellular data connection with your Mac, PC, iPad, or other Wi-Fi-capable device. You can share your connection with up to five devices at once over Wi-Fi, Bluetooth, and USB — with up to three of those connections using Wi-Fi. Every connection is password protected and secure. And it’s power friendly, too. iPhone detects when your Personal Hotspot is no longer in use and turns it off to save battery life.
Apple will release the iOS 4.3 update for iPhone, iPad, iPod Touch and Apple TV on Friday, March 11th.