I've always felt this would be THE "Killer App" for iPhone. (It wouldn't surprise me that Android can already do it, not looking to get into that argument.)
An option to record all calls or only calls involving certain people, etc. Just set it and forget it.
The legality could easily be solved using GPS. For instance Texas is a one-party-consent state so recording could be enabled without that worry. Travel to a two-party-consent state and the phone disables recording or beeps every 10 seconds or something to alert everyone on the call.