John Gruber writes about a limited set of iPhone fonts, commenting that “…but worse than that the list is so short is that some of the fonts Apple did include are so ugly.”
I think that the reason for that is to keep as wide a character coverage as possible, while saving memory. Most (although not all) of the fonts that iPhone does have are either Unicode or have many more character sets than Latin-1/Latin-2. At the same time the list pretty much covers CSS selectors for serif/san-serif/fixed/cursive/fantasy. Very pragmatic, although probably not as pretty as it could be.