Well how about that. A Commodore 64 emulator for iPhone is nothing new -- we covered the fact that one had been developed a little while ago. Here's what is new (and a little surprising, to be honest): Apple approved it. In an environment where Apple seems intent on rejecting anything that might encroach on their platform, even just a little bit, they have apparently allowed an emulator right there on the App Store.
There are catches, of course -- the emulator comes bundled with five officially licensed titles: Dragons Den, Le Mans, Jupiter Lander, Arctic Shipwreck and Jack Attack, and more will be available to purchase soon, so it'll all be above board and legit (and the flip side is that if you want to play classic titles like Elite or Ultima, you'll have to hope that whoever owns the rights to those will let them see release). The biggest catch is that the emulator doesn't come with BASIC support enabled by default (although, via Daring Fireball and the iPhone Blog, it's possible to get to it via a backdoor), so it's more of a C64 arcade emulator rather than an actual software emulator.
But of course this is a step in the right direction -- someday we may finally see official SNES or NES emulators running in full glory on the iPhone and approved and available to purchase on the App Store. This emulator, simply called C64, is available right now on the App Store for $4.99.
Update: This app has been removed from the App Store because it was possible to enable the BASIC program. Look for it to return without that functionality.