This works, but note that if you then use the iPhone (or any POP client) to access Gmail directly there is the annoying aspect of Gmail sending a cc of every message you send back to your inbox as well. I've heard mixed reports on if this is fixable...
I use Gmail exclusively with four outside accounts forwarding there and the Gmail address itself. I ended up forwarding all messages to another account (from Gmail) with certain filters in place to not forward stuff I don't want to see on the iPhone (certain autoemails, non-important stuff, etc.) So Gmail now keeps everything it gets as it has but also forwards selected stuff to the new POP account which the iPhone accesses directly. Benefit as above of going through Gmails awesome spam filter first so almost nothing reaches the iPhone, ding since any responses direct from the iPhone will be from the new POP account (in Gmail I always use the custom "reply from" for each account) and not the account they were sent to.
I'm hoping Google gets on the ball and releases a full iPhone Gmail app which allows for things like stars, replying from different accounts, etc... All the stuff Gmail power users have been used to for a while now. I know I can just use Safari to go to Gmail directly, but the Mail app is too nice not to use...
Tony