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Hm, I stand corrected. The screen shots are much appreciated.

I can honestly say that that is the first time that I have seen tethering implemented like that and I have tethered with Nokia's, BlackBerry's and a couple of WM devices. Does it do the same on Windows?

Is your iPhone Jailbroken? If it is, have you got Terminal installed? Can you do an ifconfig to show the interfaces during tethering and not? If not, don't worry, I would do it myself but am waiting for Ultrasn0w

It's a while since I used a Nokia, but I do remember them working as a modem (with a dial number of *99#) as you say. Windows Mobile used to work the same (i.e. as a modem) but recently (at least from WM 6.0) they introduced Internet Sharing, which connects as a Bluetooth PAN or USB network adapter and also acts as a router in the same way as the iPhone does.

I don't have a windows machine to test it with (I use VMWare whenever I need windows), but I suspect it will be exactly the same.

My phone was jailbroken but I undid it today because of some issues with Cydia and the iTunes store
 
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