Penumbra App

[Tommy Gun]

Haven't played Demenium, I was just using it to show what a gameplay screen could look like.
Haven't played Silent Hill for the iPhone either, but it's pretty lame. That doesn't mean FPSes have to be lame on phones, check Cube out. Works except for terrible lag but all the middle-ish maps on the second page works lag-free. At least the ones I tried. Imagine Cube with lower walking speed and way less focus on action, that could work. Or perhaps all action could be removed. In that case the entire screen except for a d-pad and an inventory button could be used to manipulate physics objects. The iPhone can't handle a lot of that, but it could probably handle something Half Life-ish. Half Life didn't have any great physics puzzles from what I can remember, but some standard throwing-crates-into-the-water never really gets old.

Also, if they made an iPhone App they could naturally make it from scratch or borrowing some engine. Converting HPL 2.0 would be lots of trouble.

You're right, converting is always a problem. You could probably get umerous low req fps games on your phone, i've seen videos of quake and doom on peoples smartphones.
And i myself haven't playedcube, might look into it though. Iphone is a smartphone, and that means it doesn't nessacerily need to run "java" which powers multimedia on most mobiles.
But mainly, its getting controls to work which are the problem.