If you sell/give away your iPhone, all of your personal data is still stored in unallocated areas of the built-in memory. This means an intrepid hacker could, in theory, read your Wesley Crusher fan-fic. Not to worry, however, because 2.0 will have a secure wipe feature that will take “about an hour (!!)” to completely clear off your sexy iPhone.
The data is deleted and then written over multiple times to ensure evildoers don’t take your precious. I wonder if the remote wipe system will do the same thing and if crooks will sit through the entire process.