Here's how I have my iphone setup:
I've used an old ram mount that I had lying around and an iphone bracket for it. I took the screen off and the lower silver headlight cover, drilled two holes and mounted the ram mount with big washers backing it up. Brought the audio lead up underneath it as you can see in the photos.
Not shown but since installed, I bought a car adapter from ebay for a couple of quid, took the little circuit board out, soldered on a power cable and then fitted it into a little plastic container that used to hold sewing thread, stuffed it full of hot melt glue and then wrapped the container in self amalgamating tape.
That lives under the silver panel too with just the power lead coming out on the other end of the phone.
So far I haven't used any weather protection, it's under the windscreen and that seems to keep it nicely out of the weather.
I have this setup, using tomtom software on the iphone, piped into my autocom. Plus side is that the tomtom software is good and works well. It has it's own onboard maps so you don't need a data connection. If you do have one it can do the smart routes thing and look for real time traffic information. Great in the UK but you might not want the data charges if roaming.
You can also control the ipod app on the phone through the tomtom interface which gives you music on the move without needing an extra ipod.
1. You can't preplan and upload your routes, which is fine if you're just driving around in the UK but if you want to plan a holiday route it's annoying.
2. You can't use it wearing gloves unless you mod your gloves, which only works on summer gloves, see my post on ukgser.com here
3. You'll need to find a way to make it waterproof. having it on the dash under the screen has kept it dry so far, I'd probably put a ziploc over it in very heavy weather.
4. If a call comes in or a text, you either need to tap the screen to answer/dismiss it or you need one of the new 3gs models with voice control. I only have the 3g, hence the glove mod.
Right now, this is a really cheap way to get a decent gps for me, but ultimately I want a zumo for long distance tours so I can preplan the routes properly and follow other peoples suggested itineraries now and then, but that's a little way off yet. As I got a 'demo' version of the tomtom software and I already had the iphone so it's been a very cheap and capable setup so far.