Flipping heck. Give us a chance! Us geeks don't live here permanently you know! 
The iphone 4 is incredibly expensive. I guess it's what you have to pay to get the "best" phone.
I think 3 are doing the best iphone deals at the moment. You can get one for £29 up front then £35 a month or free phone but £45 per month. Both 2 year contracts. It all depends on what your budget is and what you use.
The problem is whether 3 have good enough coverage in the areas you need it. I recently put my daughter on 3 and we're in the midlands. I've noticed she consistently gets less bars on her iphone but always 3G. As opposed to my vodafone phone which gets better bars but often just 2G. You may want to check out the 3 website for coverage. If you order online, you also get 7 days to return under the distance selling regulations. So if service is rubbish, you can get out.
If you are a member of a cashback site like Quidco, you can also get a serious chunk back too. 3 offer £109 back, Voda offer £140 (but then their cost is more).
To be honest if cash is tight, I really would suggest you look at a phone like the HTC Desire S or the Incredible S (CarphoneWarehouse only). The latter is identical but has a better camera and ever so slightly bigger screen. They run Android which is maturing as a technology. I find it harder to use than the iphone but its much more powerful. It depends on whether you want a phone to use...or a phone you can tinker with.
That said, the price difference is compelling. You can get the Incredible S from mobiles.co.uk for free at £25 per month on Orange or £30 on Voda. Again Quidco will give you £50 back if you buy it from mobiles.co.uk via their website.
Oh avoid the HTC Desire HD. It's too big and the battery life sucks.
Go have a play in the shops. I'm desperate to love Android but so far I've yet to find a handset which is as good all round as the iphone. That said my work pay for the line rental so its a no brainer for me. If I had to fund it myself I'd struggle to justify it.