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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.

As unlikely as it may seem, the dual boot part seems already done according to the video http://www.youtube.com/watch?v=5yO2KQHkt4A

Huh, shows what I know. Even with that, the effect you're worried about will be too small that you should be worried about it.

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