The Sparrow Framework makes an excellent first choice for those developing a 2D iPhone game. A good tutorial in : http://maniacdev.com/2010/08/beginners-iphone-action-game-tutorial/
Cocos2D is the most popular, and has the most support but is less intuitive. 2D Game Engine, Open Source, LGPL
OOlong Engine – 3D Game Engine, Open Source, MIT License
SIO2Engine – 3D Game Engine, Open Source, Payment or flash screen on game required
Additional ones:
http://code.google.com/p/galaxyengine/
http://code.google.com/p/oolongengine/
