After trying and failing to get my hands on a temporary Mac to develop an iPhone app for a client, I've started to look into VMware Workstation to virtualize OS X. I was wondering if there are any gotchas that people have found, or if the whole thing is unworkable.
For the record, I have an old stripey-Apple logo I pried off my old Apple IIe and am affixing to the lid of my dev laptop so that I'm complying with the spirit of the OS X EULA.
Prepare for an onslaught of replies on the EULA.
Technically your best resource would be the OSx86 website which is here http://wiki.osx86project.org/.
And their page on virtualisation is here http://wiki.osx86project.org/wiki/index.php/Virtualization
Importantly though, developing for the Mac and iPhone are very similar, and if you are serious about doing good developmenet for your clients you should probably invest in a mac mini at the least, which is less than $500US more than just buying the OS by itself.
That's the old rainbow logo from the IIe, right? Die-hards have the white Apple sticker that comes with every real Mac. Real die-hards have the white Apple sticker they surreptitiously peeled off their nephew's toy truck.
Cheapest option is probably to partition your hard-drive and install hackintosh:
http://www.wired.com/gadgetlab/2009/05/eight-months-with-a-hackintosh-netbook-conclusion-fantastic/
But if every time you build your app in XCode it takes long enough to catch a sitcom on TV, don't come crying here :-)
Some of my coworkers have tried the VMWare approach with OSX and have, for the most part, failed. I know there are some VMWare images floating around on the internets, but I wouldn't recommend using any of those.
Also to Bruce's point, the OSX86 project has made some great progress lately. I was able to get OSX running on an old Dell I have laying around. The thing ran fine as a media server until I made the mistake of downloading a patch, and then the thing died.
As Bruce stated a Mac Mini would be a good investment at $500, or better yet, check out eBay. Pick up something on eBay and at the end of your job you can sell it back on eBay or keep it. If your really tight on your budget you can look for a G4 Mac and do development on that, sans support for the iPhone simulator. I picked up a 2 G4 Macs for $80 a piece and sold one for $120.
Bottom line is if your thinking of getting into iPhone development make a small investment on a Mini or a used Intel Mac on eBay. If your successful in you development efforts your investment will pay off.
Good luck.
Edit: Though development on a G4/PPC mac is not supported it is doable. Here is a link outlining how to get it working.
I have a friend who's successfully installed 10.5.7 on a his Dell laptop using a distro of OSx86. He's got the developer tools and the iPhone simulator working, and he can compile his app. He can't find a USB driver for his hardware, though - so he hasn't been able to install his app on a device.
Honestly though - I think he's spent about 20 hours getting things setup, finding drivers, etc... We all thought he was crazy until he actually got the dev tools installed. I'd really try hard to get my hands on a Mac Mini before going through all the hassle.
But the Apple logo transplant... pure genius.
Obvious legalities aside, in my experience OS X performs very poorly in a VM. Installing OS X natively on your PC is possible if you have patience, and happen to have compatible hardware. I can't honestly recommend this approach however, unless you're a glutton for punishment, or would like to hearken back to those golden days when installing Linux with support for all your hardware was actually a small triumph in itself.
As others have mentioned, if you are serious about iPhone development, you're going to save yourself a lot of hassle by getting yourself a secondhand or refurbished Mac mini.