TiPb first heard rumors that iPhone 4 would finally beef up onboard RAM to 512MB back in January and it looks like those rumors are now being confirmed via information given out during the WWDC Advanced Performance Optimization Session.
Why does RAM matter? Going from 256 to 512MB of RAM let the Palm Pre go from multitasking a handful of apps to well over 50. That's why RAM matters.
The iPhone 3GS and iPad are snappy at 256MB. iPhone 4 at 512MB should -- to quote Steve Jobs -- should be a real screamer. Especially if iMovie is the kind of app we can expect to see more of. Glad Apple rose to the occasion.