In the world of iPhone ringtones, there's the Apple way, and there's the way everyone else does it. For the latter, Ambrosia has released iToner which lets you use any MP3 or AAC as a ringtone for your iPhone (we first looked at iToner a couple of weeks ago). Changes in version 1.0.2 include:
Improved iTunes 7.4.x support
Fixes an issue where iTunes ringtones might not properly sync
Improved handling of playlists
You already paid for you music, why pay for it again just to use it as a "ringtone?" iToner costs $15US and requires Mac OS 10.4.10 (and and iPhone. But you knew that).