The iPhone has the advantage that there are many, many photography apps available for it.. and I use them a lot. They are the first and only paid apps I ever downloaded:

CameraBag (€2,39)
Polarize (gratis)
Photogene (€2,39)
FocalLab (1,59)

..and QuadCamera (€1,59), but you don’t see any photos made with that app here.
(clicking the link will take you directly to the app in the iTunes store)

Soon the new iPhone, the iPhone 3Gs, will be available. It will have 3 megapixels instead of 2, autofocus, auto white balance and exposure and “macro” (10 cm distance is the closest it can get) And, last but not least, video. Too bad I’ stuck with this one for another year. Oh well, such is life…