The Newton may be Apple's most iconic failure. At the time it launched the proto-PDA perfectly embodied all that was wrong with Apple's corporate culture. The Newton's stain has only just been expunged by the wild success of the iPad, so it's fitting that some cunning hackers would use Newton OS to bridge the gap between Apple past-and-present.
TUAW reports a developer named Matthias Melcher has used Paul Guyot's Newton emulator to port the OS over to an iPhone. The emulator app has been submitted to the App Store, but it is unlikely to be accepted. You can find the source code here.