ah I've been beaten to it
as mentioned above both Jonathan Coulton (check him out!) and The Mentalists have used iPhones in stage shows.
Don't know about the mentalists but JoCo was good, but there it was a gimmick for one song not the backbone of his act.. I hope this guy's the same cos the gimmick appeal probably won't last for a whole set. I don't know though, I wouldn't be going to a Take That gig anyway, they might love it!