Scott Squires of ILM and Commotion fame (see his Effects Corner blog) escaped Steve Jobs' kill switch and upgraded Squiggles, his paint app for the iPhone (mentioned earlier in Roto [+apps] on iPhone):
"Just to let people know version 1.1 is out now [with new video and images]. Still no roto but you can smooth paint, use cursor for precise placement of paint, full spectrum color selection, overlay layers (provided overlay images, may open this up in the future for user layers), text layers, color stamp brushes, eraser, cloning, realtime adjustments, distortions, etc... I may consider a more pro-photo app in the future."
Also, ReadWriteWeb posts about 4 Great iPhone App Review Sites and TechCrunch notes Great Review Site[s] For iPhone Apps.
Update: As noted earlier, The Edit Blog has some ideas for iPhone apps, and both Self Reliant Film and John Nack have lists of ones that might be useful now.