So first, the iPhone appeared on the Apple Component cable page, and then we heard it didn't run video out, and then it did again, or maybe it didn't. At any rate, we finally have confirmation for you, thanks to punkassjim, that the iPhone will do video out.
In fact, he tells us that it will even show a preview of what you're watching on the iPhone itself while the video plays, along with the standard video controls and information. Very slick. I assume the display is the exact same resolution as whatever your video is-- on some TVs that will matter, on some it probably won't. And I'm pretty sure, even though he didn't say, that this is an unhacked iPhone on 1.1.1-- the update to do TV out came with that.
Finally, Jim says he was disappointed to find that the cables didn't, however, work with his iPhone's dock-- when he plugged them in, he wasn't asked to display to TV as in the pic above. Good news, though-- he also notes that the issue is being fixed with the new Universal Dock, as Apple specifically says they'll work. If you keep lots of video media on the iPhone and have wanted to get it on the small screen, you're in luck.