As we reported earlier today (before the Apple event, even), the iPhone 3.0 update will allow real, turn-by-turn directions on the iPhone. It looks like Apple isn't bothering with enmeshing themselves in the confusing licensing issues surrounding turn-by-turn and is instead simply lifting the SDK Ban on turn-by-turn directions. The first app may very well come from Sygic (that's what they're claiming, anyway), which we had the chance get some eyes-on time with during Mobile World Congress.
Apple is simply allowing 3rd party apps to extend their access to CoreLocation (the iPhone's built-in location service that includes GPS, cell tower-based, and WiFi-based location) to include turn-by-turn. Of note: Apple says that developers need to "BYOM" (Bring Your Own Maps). What that implies is that the licensing issues referenced above prevents Apple from allowing developers to use another new iPhone 3.0 feature: embeddable maps. iPhone 3.0 allows (almost) any app to include embedded Google maps, complete with pinch, zoom, and the like, within the app itself. Using that embedded map for turn by turn directions, however, is verboten. Instead developers will either have to require a large download of maps and/or provide them over-the-air as TeleNav does.
It's also possible that developers will be able to use the new in-app purchasing feature of iPhone 3.0 to allows users to purchase maps as well. It's unclear who else besides Sygic is getting a turn-by-turn directions app ready, but you can probably rest assured we'll see such apps from the big players in short order once 3.0 is released this summer.