I believe the Touch has a mic too. The vendors site does say it works with the Touch but they aren't sure accurate the mic is on the Touch. And I know my son has done some recording of his voice on his Touch.
The iPhone 3G is better than the 3Gs. Apparently the 3Gs rolls off the low end severely which was done by Apple to deal with noise (wind) issues encountered by users.
This thing is supposed to be more accurate than the rat shack meter. I have read some reviews on the apps, including some by pro audio guys, and the consensus seems to be it is accurate. And it does have calibration and weighting. And it does have that kewl factor about it.
And there is an RTA app as well. In fact there a number of apps, including a suite of all the apps called AudioTools.
Since I don't have a SPL meter, I'm going to spend $10 or so and get the SPL and RTA apps. Seem like the best bang for the buck for me.