I use the app from geocaching.com as well. I tried using it to replace my handheld GPS but it didn't have the accuracy on some of the tougher finds. So I now use it as a faster way to find geocaches nearby and then plug them into my handheld without having to plan ahead and download maps and such into my gps. Now when I travel, I just keep my GPS in my luggage and use my iPhone to find the cache details and the GPS to actually find the cache. Like bgattis said, i am awaiting an update to the app to add extra features like posting the find and photos, etc.
I know people who cache successfully with google map printouts and a lot of bushwacking so the iphone would be a huge step up for them. However I am used to my GPS taking me within feet of the cache now so it wasn't good enough for me.