The first step is to calculate the original speed of the bus. The bus takes 3 hours and 30 minutes to cover 280 km. To convert 30 minutes into hours, we get:
\[
3 \, \text{hours} + \frac{30}{60} \, \text{hours} = 3.5 \, \text{hours}
\]
Now, the original speed of the bus is:
\[
\text{Speed} = \frac{\text{Distance}}{\text{Time}} = \frac{280 \, \text{km}}{3.5 \, \text{hours}} = 80 \, \text{km/h}
\]
Next, the desired time for the journey is 4 hours. To find the new speed required to complete the journey in 4 hours, we use the formula:
\[
\text{New Speed} = \frac{280 \, \text{km}}{4 \, \text{hours}} = 70 \, \text{km/h}
\]
Now, the decrease in speed is:
\[
\text{Decrease in Speed} = 80 \, \text{km/h} - 70 \, \text{km/h} = 10 \, \text{km/h}
\]
Thus, the speed of the bus needs to be decreased by 10 km/h. Therefore, the correct answer is (3) 10 km/h.