I've been researching on this too. I find that HTC Diamond II has sooooo much to shout for, good camera (5mp), built in document suite, built in GPS, Wifi, Search all function, nice browsing experience, looks damn sleek (tho appeals towards guys more), touch screen, stylus, nice quality built, Windows Mobile 6.1, 2 cameras for video call. The touchscreen accepts input using fingernails (especially for ladies) but not as responsive as iPhone.

Whereby IPhone 3GS has PLENTY of apps to keep you entertained, looks GOOD, very good browsing experience, very good touchscreen experience. However, iPhone's touchscreen only accept input using fingers/thumbs. It can't detect fingernail input. This is something ladies would need to watch out for since the long nails mail make the input (especially for SMS/EMAIL) very annoying. But of course, these can be overcome with a little practice. and the single camera for video call is pure stupidity.

My verdict? if you want something that can offer more, for work purpose and entertainment, go for HTC Diamond. If you're into good looks and solely entertainment, iPhone would suffice. However, I still think iPhone is a bit overpriced for what it offers compared to what HTC can offer, unless you signup for Maxis plan. Hope that helps!