On the plus though, for the developer, advertising the feature certainly helps drive sales; as does "negative" press on Wired like this :)
It's not a serious camera in the sense that I wouldn't take one to do a magazine shoot, but lots of people take really good photos with phone cameras these days, they've come a long way.
If flash is on, advanced software could combine the before-movement non-flash image with the flashed image, but I think that (currently) is too computationally expensive expensive for a mobile device.
I was going to say that using the volume buttons permits the user to hold the phone in a proper camera stance (hand underneath the base to improve stability, no elbows out), but having just held an iPhone 4.0, I saw where the camera is placed and where the volume button is relative it, and how to properly hold the phone. It does not seem like the volume button is in the right spot for where the camera is to even use it like a proper camera. You're going to have to hold the phone weird to take a picture without your finger in the way to use the volume button as a shutter.
tl;dr. The volume button isn't even in the right spot to use it as a shutter, and I wager pressing the volume button doesn't have any true advantage.
For a phone that has a shutter button in what I perceive as the correct location, see the original Motorola Droid.
(In the old days there were cable releases, but I haven't seen one of those since... 1990?)
I'd day jiggle induced by pressing the volume button is a non issue. In fact, on the next iPhone I would love to see this as a default behavior.
Also, I have never had a camera with an IR trigger. Want. :)
Sure, maybe your average user may not do this, but it would make the hardware shutter button a useful feature for the rest of us.