Since no one has an iPhone yet, this is a bit hard to get a real answer on.
However, from what I’ve heard/seen/read, the iPhone will only play back video in the horizontal orientation (and will stay that way even if you tilt it vertically.)
Since the iPhone is an iPod, then just follow Apple’s specs for their current video iPod. I do have experience producing material for the current iPod.
Scroll down to the middle of this page for specs: https://www.apple.com/itunes/store/podcaststechspecs.html
Don’t edit material at the iPhone’s resolution. Edit it in the native resolution of your acquisition format. Then, after you’re finished editing, encode the material for the iPod.
Basically, you can export using QuickTime Conversion and choose the “Export to iPod” setting, or if you use a 3rd part app, then export at 640×480 for 4:3 material (which will most likely put black bars at the sides of the iPhone screen when playing back on the device’s 16:9 screen) or 640×360 for 16:9 material. Either way, the iPhone will scale the video down to match the resolution of it’s screen just like the current video iPod does.
Of course, to be absolutely sure of all/any of this, wait until June 29th or later to verify it…
I hope this info helps.
Jon
TreeLine Productions
Fort Collins, CO USA
Currently producing these popular podcasts: