We've used magnetic holsters with iPhones back to the original model. Total non issue. Also a total non issue as far as theft goes. No, they don't make you a bigger target unless you're the type that has to constantly flash your phone to stroke your nonexistent ego. What nonsense. LOL
I second the eBay suggestion. While I do have a different leather pouch on order because I need one with a pocket for my headphones, my last two leather belt cases came from eBay. One even fits my iPhone 4 with bumper better than it fit the original iPhone with snap on case it was bought for. Well worth checking out!