I think the issue with it on iPhone is that, unlike iPads, iPhones are generally held in portrait orientation. There really wouldn’t be a lot of room for icons that can still be comfortably and reliably tapped. It just doesn’t scale.
The dock on iPhone just needs a little love. I’m not sure the user experience is the same as the iPad, but that doesn’t change the fact that they haven’t ‘cleaned it up’ forever... with no names under the icons the amount of space it uses seems so redundant...
I guess we wait for Phone Edition to see how they handle it