The $10 Rock Band iPhone app that's on the App Store now is basically the console experience brought to your phone, complete with a music store to get new songs for $1. The only thing lacking is the control scheme.
Rock Band suggests that you play with your thumbs on the bottom of the phone, supporting the weight of the phone by gripping it at the base. People with normal-sized hands will find the position cramp-inducing, but bearable. I would recommend that you lay the top of the phone on the edge of your desk to support some of the weight and give you more freedom to lift your thumbs up to move around without worrying about dropping your phone, but that's just me.
The guitar/bass gameplay is essentially a port of the Rock Band you know from previous Rock Band and Guitar Hero games, and what you're familiar with if you've played the Tap Tap games on your iPhone. The singing is unfortunately NOT singing, and you'll have to tap one of the four pedals on the side to "sing". The drums are just like drums, and just like the guitar gameplay, so that's not that surprising. So it's only the singing that's kind of a disappointment.
For $10, it's not that bad of a game, even though the limitations of the control scheme put a hard barrier on how difficult the songs can be. Even with hammer-ons and pull-offs in place, the guitar difficulty can never really progress beyond having you play with two thumbs at once and moving one thumb around really fast.
There is multiplayer, but only over Bluetooth and only locally (obviously). I didn't test this out.
Your other consideration is that the base game is 158MB already, and each song comes somewhere between 10-20MB each. If you have a smaller device, you might have to delete some stuff to fit this. It would be nice if buying a song also added an iTunes version of the song to your library, but that's pretty unlikely. And although the game ships with 20 songs, only 15 are available at the start, and you'll have to unlock the other five. [iTunes]