At this point multitasking on a iPhone requires "jailbreaking" the phone. However, this is much simpler than it used to be and is easily reversible. Google "blackra1n".

There is a lot of speculation that iPhone OS 4.0 will multitask.

However, I have both an iPhone and a Garmin 705 handlebar mounted for one reason: the iphone battery life with the GPS running is way to short. The Garmin is good for more hours than I can pedal in a day.