Ringtones are one of my biggest gripes. It's not iPhone specific, but for most phones. The reason is that you're basically paying for the same song twice, and that isn't more obvious than with the iPhone. From what I hear, you'll pick a song from your playlist, and for a 99 cent fee, Apple runs it through a process to make a 30 second ringtone. So, you pay again for just a snip of audio you already own?? That's just crazy!
I guess I'm spoiled because, with my Motorola, I can use their software (Motorola Phone Tools) to take a song I have and turn it into a ringtone FOR FREE! Plus, I get to choose what part of a song I want and how long I want it to be. Of course the software has a cost, but it also does much more than ringtones, and I've definitely gotten much more than my money's worth from it.