If you have a use for a cut down word, excel, powerpoint, etc - go for the Xda PDA; otherwise - go for the iphone 3g.
I had the Xda (Or something very similar) and now use the iPhone. The latter has limitations; but those are outweighed by it's ease of use.
the Xda is clunky and not very user friendly but DOES have the cut down office apps above.