Security Vulnerability in iPhone 3GS/iPod Touch Recovery Mode

Part of the appeal of the iPhone 3GS and related 2009 iPod Touch models is the built in hardware encryption, but a well-publiced attack (http://www.youtube.com/watch?v=kHdNoKIZUCw) by iPhone Forensics specialist Jonathan Zdziarski means that the encryption can be circumvented by putting the device into Recovery Mode, as there can allow the installation of a custom kernel WITHOUT authentication (Passcode or equivalent) being invoked (http://www.schneier.com/blog/archives/2009/07/iphone_encrypti.html#c386843).
There is a rumour that a fix for this missing authentication was included in the iPhoneOS 3.0.1 "SMS" patch, but I can find no documentation that it was included in that patch, nor any other statement as to whether this has been resolved.
I am working with clients who would be interested in replacing aging PocketPC based PDAs with a mix of iPhones and iPod Touches, but would not be interested in buying a platform with such an egregious security design issue unresolved.
Any further information would be welcome.
Thanks!
Bill

Part of the appeal of the iPhone 3GS and related 2009 iPod Touch models is the built in hardware encryption, but a well-publiced attack (http://www.youtube.com/watch?v=kHdNoKIZUCw) by iPhone Forensics specialist Jonathan Zdziarski means that the encryption can be circumvented by putting the device into Recovery Mode, as there can allow the installation of a custom kernel WITHOUT authentication (Passcode or equivalent) being invoked (http://www.schneier.com/blog/archives/2009/07/iphone_encrypti.html#c386843).
There is a rumour that a fix for this missing authentication was included in the iPhoneOS 3.0.1 "SMS" patch, but I can find no documentation that it was included in that patch, nor any other statement as to whether this has been resolved.
It was fixed in 3.1
<http://support.apple.com/kb/HT3860>
"A heap buffer overflow exists in Recovery Mode command parsing. This may allow another person with physical access to the device to bypass the passcode, and access the user's data. This update addresses the issue through improved bounds checking."

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