In October 2006 I got arrested for soliciting prostitution. I was jailed for a 2 hours and was giving a court appearance notice and release. I appear in court and was giving a fine, placed on summary probation for a period of three years plus had to take an HIV test. I comply with probation the test and the fine. That's the only arrest and conviction I have besides a traffic ticket I got on August of 2008 for running a red light. My green card expires Feb 2012. I was thinking of renewing my green card or should I apply for US Citizenship?
Regarding GC renewal in the context of N-400 application: this point is explained on p. 13 (Q 24) of "A guide to naturalization"
http://www.uscis.gov/files/article/M-476.pdf
If you file N-400 with more than 6 months validity of GC remaining, you do not have to renew your GC before N-400 is adjudicated. If you file N-400 with less than 6 months validity of GC remaining, you do have to apply for a GC renewal; in that situation it is not necessary to have the actual new GC before filing N-400 or even at the time of the interview: having a receipt notice for I-90 (application for GC renewal) plus the old GC is sufficient.
In your case, because of your 2006 arrest and conviction, you cannot file N-400 until after 5 full years have passed since the date of conviction (that is, the date you appeared in court and were convicted) on that prostitution solicitation charge. If you apply earlier than that, you will be denied since soliciting prostitution is a crime involving moral turpitude.
See
http://law.justia.com/cfr/title08/8-1.0.1.3.68.0.1.7.html
So as a practical matter, you will have to apply for GC renewal before you may submit N-400.
If you submit an N-400 application after 5 years since the date of that 2006 conviction, you are not statutory precluded from being approved for naturalization, but the IO can still take that conviction into account when making a good moral character determination, and you may or may not be approved, depending on your luck with the IO.
You will need to provide court certified documentation regarding the details and the disposition of that 2006 conviction, in particular showing that you have served out your probation period with no problems (you can request that from the court where you were convicted).