I agree I think a smart cover for the iPhone is a great idea IF done right. It would obviously have to different from the iPad in some ways because I'm my opinion it would get tedious constantly having to uncover the phones screen just to see notifications. I do like the TidyTilt referenced above, so much so that I bought a blue one a couple days ago.
I buy a case mostly to protect the back and camera when I set the phone down. Sure it wouldn't help you to much if you dropped your phone with this case but heres to hoping I don't do that.
Magnets do not cause issues with SSDs. The magnets were issues with HHDs because as it was spinning and using it's own magnet to write information, magnets would stop it, or move parts/data around. There is nothing to move/mess up.
The tidytilt is a neat idea but I was really disappointed that it is mostly for your earphones organization and protects the back, not the front. What I want is an exact copy of the iPad 2 smart cover, but for my iPhone 4.