It's taken me some time but I've got it figured out:
By default, GMail on the iPhone is enabled in 'recent mode' where it pulls down your 25 (or 50 or whatever) most recent emails. In this mode it is not actually acting as a true POP3 email client. When the messages download, they are not being cleared out of your inbox.
That being said, and establishing that it's not operating as the standard mail.app would on a Mac, it operates almost as if you were just using GMail's web interface as far as sending mail is concerned.
To understand, go to GMails web interface, send a message to someone. Then look at Mail.app on your Mac. The next time it retrieves mail, it will receive the message you sent. This is due to the way that GMail's archive folder is set up. Since messages are essentially in one giant folder, Mail pulls all messages that have not been previously downloaded.
So when you access it on your iPhone, you are essentially looking at the 25 (or whatever) most recent emails, which includes emails you sent.
You can disable recent mode on the iPhone by going to the advanced mail settings. This will cause the iPhone to operate more like Mail.app, pulling messages off the server using POP3. Do note however, that if a message is downloaded to your iPhone, it will not be available to be downloaded later to your Mail.app.