Yeah, anybody who claims to be a techie salivates at the mention of iphone. Windows mobile devices do pretty much the same thing but in complete absence of a sense of style.
I debated getting an iphone, but eventually just bought a motorola A780 off Ebay. It's Linux, does most of what iphone does, the camera is a little skimpy at 1.3 MP and you have to stick a card into it to have room for mp3s, but it was 100 US dollars and all I had to do was transfer my SIM card...