What a dangerous claim you're making here. An unbacked assertion that it might be a bad thing. You're really going out there on a limb, aren't you?
This is neither a good thing or a bad thing for Android. Nobody real cares, so it's unlikely to get much publicity positive or negative. It's no skin off Apple's back for two reasons. First, you already paid for the device; they have your money. Second, no one in their right mind would want to use Android OS over iPhone OS anyway, especially not if they've already paid for an iPhone. It'll have no impact on Google because of the aforementioned lack of real people taking any interest.
I am going to make the firm claim that this will have no noticeable impact on anything and will probably not even merit an unprompted official comment from either Apple (I'm rescinding my claim about Google, because those Googlers are notoriously chatty and I wouldn't put it past one of them to mention it on an official blog, but probably not). I invite anyone who disagrees to put money on it. I'll be $10 to charity against the first two comers.
I don't mean to diminish what this guy did in any way - it surely took a lot of time, skills and perseverance.
What I'm concerned about is that some people, who under normal circumstances would have bought an Android device, might buy an iPhone thinking: "Well, this is the best of both worlds, it can run Android and the iPhone OS".
This kind of thinking could do a lot of harm to the Android community: less money for Android manufacturers who support Android's development, lesser user experience on the iPhone-Android (considering it's basically a hack) might leave a bad impression to first time users, etc.
I don't think "FrankenMac's" where people were loading OSX on generic Netbooks had any effect on Apple's hardware sales. I doubt this will either. Its a super clever hack and mighty amusing. But I'd assume that, much like the FrankenMac's, it'll be too awkward and unstable for most people to even consider using long term. (I know I gave up on running a frankenmac under VMWare, and all the people I know who were running frankenmac netbooks have gone back running either Windows or Linux on them. A few of them keep an OSX partition around just to show off that they can do it. :-) )
And what I'm saying is that it's extraordinarily unlikely that more than a handful of people will have the reaction you worry about. Among other things this would void the warranty, and most people like warranties on their phone. It's also unlikely to ever get into a state where it's dual-bootable, so only the most extreme of tinkerers will consider this a selling point.
Nobody in their right mind, huh? Guess I'm crazy, because I prefer using Android over the iPhone (my iPhone is sitting sans-simcard on my desk right now).
Not only does the notification bar kick iPhone OS' notification scheme, and despite the low app volume on the market (I don't have /that/ many apps - and I didn't on the iPhone, either), I'm still lovin' my Android. It may just be the honeymoon period, though. (Got a SNES emulator running the other day - great for the commute. Disclaimer: I only have ROMs of carts that I have packed away in my closet)