The Apple Blog has posted some some great tips/techniques for keeping your screen looking like new, and while they are directed for glossy screen owners, the same basic techniques can be used for any screen, be it iPod/iPhone, matte LCD screen (like on a MacBook Pro or older Apple laptop), iMac, etc.
The key is getting the right type of cleaning solution an the right type of cleaning cloth. The author of the tips article recommends using monitor wipes from some sort of Office supply store, but I've found that unless you get individually sealed one-time use wipes (which can get expensive), the wipes tend to dry out very, very quickly, effectively making them useless. I prefer to use cleaning product like iKlear or a home-made 50/50 solution of isopropyl alcohol and bottled water. 99% of all electronics cleaners out there are essentially diluted isopropyl alcohol (add blue dye and some fragrance and ammonia and you have Windex -- don't use Windex on your screen).
As for the right kind of cloth, you want to use a lint-free microfiber lens cloth (it will be slightly textured as opposed to a smooth microfiber cloth that you use for polishing/cleaning an iPod or digital camera screen, you can use a smooth microfiber cloth, but I have had much better results with the more textured ultra-suede cloths for laptop screens).
Now for the actual cleaning: