James Bird is an aerospace engineering student at Manchester University. As he recounts, when his iPhone was stolen he alerted his friend, Nick, who tracked the iPhone using Find My iPhone on his computer.
Nick then handed his own phone to James and a mutual friend Alex, who received running commentary on the iPhone's whereabouts from Nick back at the computer. Finally they spied the man who likely had the phone and he took off on foot. After a footrace, James and Alex chased the man onto a bus and confronted him. James asked for the phone and the man denied having it, but the bus driver refused to drive until the suspect could prove he was not in possession of the phone. Realizing he was caught, he handed the iPhone over.
As fate would have it, there was a police car behind the bus. The suspect was then arrested.
Go, technology! I've had first-hand experience myself with using Find My iPhone to retrieve a lost (but not stolen) iPhone. This is the first app everyone should install -- even if you're not in the habit of losing your phone while preparing a skydiving run.