SayAgain [iTunes Link] is another bookmarking app which solves both of those problems, but not nearly as well or as elegantly. It is compatible with the iPhone and iPod touch and requires iPhone OS 3.0 or later. It sells for US$1.99.
One of my pet-peeves is that many apps give you no instruction on how they work, and SayAgain is one of those. When you run it you are presented with a lined screen titled 'Annotated Media'. To the left is a + button and to the right is an edit button. Now what? Clicking on the developer link in iTunes brings you no help, only a description of what the app does. Nowhere in the app is an info button to bring some direction. But, one might say, it's intuitive. You don't need help. I say, nonsense. Everyone comes from a different level of experience and assuming intuitiveness is a bad assumption. Bookmark, on the other hand, gives full instructions and a tutorial right inside the app.
SayAgain is a generalist audio bookmarking app, allowing you to add bookmarks to any audio file in iTunes. This is quite useful since you might want to bookmark a story in podcast or even a great drum solo as well as a place in an audiobook.
There are two ways to use it. Either play something in iTunes and then run the app which will display your audio file as Now playing, along with the name of the song or file. Or you can run it without playing anything and hit the + button which brings up iTunes. Leaving the app doesn't stop the audio, a major advantage. To add a book mark you click the star (which in other apps means favorites), and you'll get a window with a keyboard and buttons to 'Set start marker' and 'Set end marker'. On top of the screen are buttons marked back and play.
Read on to see how well it worked.