Google, this morning, announced that Google Earth is available for the iPhone via the iTunes AppStore. There doesn't appear to be any way to use your own layers, but maybe that's a feature that we'll have to do a bit more searching for or will come in a future release...hopefully.
Having downloaded and tried out the application, I can say it certainly is a slick piece of work. The options dialog seems to be a bit quirky (I can't tell whether it's crashing or just running afoul of the iPhone guard timer), but the zooming, panning and search functions all work as you would expect them to.
Of course, GPS location (permission required) is supported, so it can show you where you are.
For added fun, though, you have to play around with the Auto-Tilt feature (enabled by default) which tilts the view up toward the horizon as you lift the phone from level to upright. There's a lot of dragging and pinching too. As expected, pinch-in and pinch-out zoom the map, and if you hold rotate two fingers around themselves, it rotates the view (which can be easily reset to North by clicking on the compass in the upper right corner).
Pretty darned slick. Although, I certainly wouldn't have wanted to use it when I was over the boarder in Toronto this AM and was paying per byte for my data service.