For all the naysayers, here's my iPhone 4 when held normally in my left hand (which is the hand I use predominently to operate the phone). http://www.youtube.com/watch?v=6DWCtEh0yRw
The reason I know it's an issue with the iPhone is because a different, low end phone on the same held network, held in the same way, in the same location, doesn't lose enough signal to drop to 'no service' like the iPhone does. Let's hope Apple get this fixed by the iPhone 5!
You do realize that dumb phones typically have their internal antennas at different locations than most smart phones, right?