Just to chime in (given all the idiots on this thread saying "don't sweat as much" and "use a shuffle")...
1.) Some of us don't think we should need to buy a shuffle when we already own a $600 phone that stores far more music. Additionally, when I run I always do it on a treadmill. The iPhone sits on the treadmill's magazine rack perfectly.
2.) Yes, the iPhone earbuds suck for exercise. They fall out and the mic is very sensitive to moisture. Rain, sweat, whatever. I have gone though 2 sets myself because once moisture gets into the mic, it's pretty much useless.
I'm pretty sure I'm going to be moving onto a better set of earbuds (preferably with the mic) for running. The mic's button is invaluable for changing songs.
Oh, and one more thing -- to all those people complaining about sweat... wtf do you think you should be doing while exercising?

I personally love it when I see someone get on the treadmill, set it to 2 miles an hour, walk an hour and wonder why they're still fat. The purpose of exercise is to stress your body beyond what you'd get from sitting in front of your computer. If you're not sweating, you're not doing your job.