I have heard that it deleted their old save when starting a new one. Is this true, and how do I prevent it?

I haven't run into this problem. The safest is to back up your saves. Another way would be to have some extra saves, make sue to do a new save. From what I hear the beginning autosaves and it sometimes overwrites the old save.

OK. Well right now I only have one save I use, so should I just create 2 or 3 of them?

What? Never heard of that problem... I never had it occur to me atleast..

what I did on 360 was use separate accounts for different characters
that way the saves are completely separate and can never get messed up

of course you can, I must have 50 or so different saves from different characters and back-ups... maybe i didn't understand the question

You can *SAFELY* make a new character if you are smart enough to ever save your game and not just rely on the autosave...

Well for me on xbox I would copy the game save onto a removable hard drive, but its not hard to not save over your previous game anyway. I presume you can do the same for PS3.

Make a new PS3 profile and save your game there?

That's how my wife and I coexist without trampling all over one another's saves. All her saves are in her profile, all my saves are in mine.