"The iPhone 3G is a paragon of embedded device security"
Hmm, you care to share with us how many embedded devices security you have evaluated ?
"In short, this hack wasn't some bunch of script kiddies having a sleepover and cracking the copy protection on Arkanoid 2 for the C64."
It is exactly this and the crack sucks big time, just check user forums how the solution performs.
"some of the tightest security ever found on a PDA or mobile phone."
Again such a big claim. It is visible you have never done and embedded hacking in your life.