WordPress tells me their native iPhone app is coming soon, somewhere around the end of the week or early next week.
Functionality-wise, it looks very similar to web-based blogging apps that are already available, except with the picture uploading of course. It will be free at the launch of the App Store.
TypePad is next up, and lets you make blog posts with photos (take one on the fly or choose one you've taken). It's a blogging tool.