Does anyone know if the iPhone uses excess memory for RAM or does it have another chip in it for RAM? In other words, will an iPhone work better (faster) with some memory left empty so that it can use if as virtual memory is used on a Mac?
The iPhone has volatile SDRAM for OS and application runtime-RAM usage and flash storage for data storage. It does not use virtual memory. So no, leaving more space on the flash storage will have no impact on application speed.