Zipit z2 is what i have.

$50, full qwerty back lit keyboard, sd mini slot, headphone jack, speaker, 320x240 screen, wireless G (not just B like the stupid psp), and can be flashed to run debian linux with whatever programs you want that'll run on it.
After you flash the device and put linux on there, the list of things you can do with it increases magnanimously.
I can emulate a lot of consoles with it, play other games, browse the web, watch dvd quality videos, listen to music, and with finch instant messenger i do facebook, myspace, msn, yahoo, aim, and icq. It's also great for just using as a terminal for downloading stuff (uses a lot less power than a honking desktop or laptop for doing nothing than downloading one big file). There's a lot more stuff you can do with it too. But, it's essentially a $50 general purpose laptop that can fit in your pocket.
EDIT: It sure is no phone though.