The iPhone 3G GPS usually has an accuracy of 56 feet for me, or 34 if I'm really lucky. (Nothing in between oddly.) I've had about a 50% success rate finding caches within 56-feet which is ok if I'm looking for one on a lark but if I just walked 20 minutes to find a cache it's frustrating to get stuck. It makes me not even want to try next time.
And in the forest where there is no reception it's almost useless.