found a solution
i found the solution, thought i would post it here...
my iphone was new from at&t, and out of the box i had this issue. when i would talk with the headphones in, apple provided, i would hear an echo. I found that is was due to the fact that that the input speakers on the bottom of the iphone4 were still enabled when the headphones were plugged in....this caused the echo.
I flashed the phone back to factory defaults, verson 4.1, and the issue was resolved.
So, if you have an iphone which is new from at&t (aka. the worst cell company in the universe) flash your phone to factory when you get it!!!!!!