I just finished a similar project. Had a metal shed that came with the house that the former owner had put on top of a wooden frame floor. Wood had rotted out and a family of skunks moved in. Went in one day to get the mower out and it was stuck. Pulled a little harder till I saw this little black tail with white stripe under the wheel at which time I stopped pulling and started running. It crawled out from under the mower and moved into the flooring. Seems it had set up a nest in the grass collection bag..
So, moved the shed, got rid of the wooden floor and poured concrete. It is at the base of a hill so I had a similar problem to you.
First of all, I used 2x4's for my framing. This leaves a 3 1/2 inch thick pad (silly dimensioned lumber ... 2x4's aren't 2 by 4 ..). I leveled the ground with the tractor with a very slight (1 in 10) slope back to front by digging down in the high area and filling the low area. I compacted the dirt with the loader, added a yard of pea gravel, packed with yard roller and 10x10 inch tamper, added a half a yard of sand, packed with yard roller and 10x10 inch tamper, framed it with 2x4's, layed out the rebar and poured the concrete. As to why the mix of fill? I figured I needed a yard and a half for base and had the sand left over from an earlier project..
Just moved the shed back last week. Project took about 6 months since I gave the base time to settle (yeah, that's a good excuse /forums/images/graemlins/smile.gif )
I dug into the hill slightly so the top of the pad was just above the slope of the hill. Unfortunately this leaves the front of the shed 3 inches above grade and me needing to build a ramp. I am now using a piece of plywood with some scrap lumber under it to roll the mower and other implements into the shed.
If I were to do it again, I would dig down until the front of the pad was maybe 1-2 inches (instead of 3-4) above grade and build a curb on the high side to run the water around the shed. One person suggested it and I thought I would try my way. His way would have been better.
So, to answer your topic ... 3 1/2 inches thick should be fine for a tool shed and is what you get with 2x4 framing. I have been told that gravel is better than sand for the base.