Some are hypothesizing that the iPhone will make for a kick-ass combination of the Nintendo DS and Wii, once firmware 2.0 comes out and the apps flow from the App store. I too thought, "who needs buttons when you can touch and tap and tilt your way through a game?" But as I held the thing at WWDC and played Monkey Ball, I saw a problem that could be an issue with all tilt controlled iPhone apps: As you angle the screen to simulate a joystick, visibility goes down. Way down in some cases. This is worrying.
Off axis visibility on most LCDs is not as good as it is straight on, and by tiling the iPhone as little as 20-30 degrees in any direction and you have a marked drop off in lighting. The perceived screen real estate goes south, too, simply from the angle you're viewing it at. Don't believe me? take a look at the simulated video I just made.
On top of visibility being reduced, it actually made me a little queasy. We're used to fast motion on a screen for FPS games and the like, but fast motion on a screen which is also in motion is a new thing to most.
Game companies can maybe set programs to boost the brightness on tilts, but the geometry still limits real estate, and the motion would still be awkward. I suppose that controller sensitivity could be tweaked for more subtle movements, but in my experience, subtle accelerometer controls don't work as well as the ham-fisted inputs. I also suppose we could all tilt our heads/torsos with each movement, but isn't that exactly the kind of amateur gamer twitch we all make fun of our parents for?
Not a deal breaker by any means, but it's something you'll all notice once you start playing, I'm certain.