Is not about running the game (a DS could run a 3D Fallout 3 game), is about the type of game that would be. Don't you understand that? It's absolutely impossible, impossible, impossible, and once again, impossible to fit a game like Fallout 3 on the iPhone. Not only is impossible, but nobody would ever do something like that. Why in the world would you put any money behind a project that's going to be sold for maximum $9.99, and only a few thousands would buy? It doesn't make any sense. Stop thinking that Fallout 3 on the iPhone will ever happen.
Even if they could manage to fit a game as big as fallout 3 into the iPhone, with smooth controls and graphics (based on the iPhone capabilities), it is a type of game that requires TIME, and how on earth that is supposed to work with the poor battery life? and why would anyone would like to play it in his house, in a small screen if you can play it in your console or PC?