Nighwatch has released SSH binaries for the iPhone and as of 11:45PM Central Standard Time we have a fully interactive shell over ssh. Stay tuned for a details...
don't believe me?
# /sbin/uname -a
Darwin iPhone 9.0.0d1 Darwin Kernel Version 9.0.0d1: Tue May 22 21:15:55 PDT 2007; root:xnu-9220.127.116.11.obj~3/RELEASE_ARM_S5L8900XRB iPhone1,1