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This came up in another thread during a discussion about data limits; rather than hijacking that thread any further, I thought we could start a new one for a tip that often goes overlooked.
The answer is that you can watch HQ over 3G, but for many people it will mean a change in how they access YouTube on their iPhone. Here is my original response, which will hopefully help someone who might be looking for a solution to this small but annoying issue: