Which programming language would be more suitable for an online 3d chat style game, not something as advanced as like secondlife but like an MMORPG without the weapons and stuff. It also wont need to hold more than 500 users at any one time. Basicly I want to setup a small to medium sized 3d chat world where people from certain forums can come in and chat mostly. Other features I was thinking of would be somehow tying a points system on a forum (phpbb) into this online 3d chat to allow points to be earned and deducted while in game, possibly vehicles and even possibly being able to build your own buildings like in second life. I just need to know what language I would be better going with and if I should build my own engine from the ground up or go and purchase a premade game engine like torque. I know some basic's in c++ but probably not enough, but before I go out and start buying books I need to know which language to go with.

you know some basic's in c++ so you can start with it. but i think vb is more easy to pick up. and it suit the work you will do.

A 3d chat in visual basic? Is that possible? Seems vb is more on the side of application design. Has directx ever been used for online 3d chat programs?

As has been said, they are all just tools. Use what you can do the job fastest and best with.
However if you still want an opinion.
Id say it depends on what your aiming for. If you want full blown graphics in this 'game' and a fullscreen app use c++ since you already know it.
If the graphics dont have to be extremely good and your aiming more at ease of use for all people, use java and make an applet. Thatll probably save you a lot of time. For the 3d part I heard you can use OpenGL with Java in some way and there is Java3d.

-CProgrammer