Let's all just stick our fingers in our mouths and hail a cab to reality town for a second.
This is a simple miscommunication, that's all.
Look at it from the OP's point of view:
He's discovered Geocaching and got all excited at finding his first cache, as I'm sure we all did.
The moment he popped the lid of the iconic lock&lock he thought to himself "I've got a brilliant idea for a cache! I love this!" as I'm sure we all did.
By the sounds of it he lovingly spent some time putting his cache together, not some pokey magnetic nano stuck thoughtlessly behind a street sign, and trusting his device (and why shouldn't he if he used it to find one already) placed it and submitted it for publishing with glee in his heart that he's contributed to the community.
The reviewer saw the cache with admittedly a severe accuracy issue and, after a couple of messages, decided to archive it. Understandably the reviewer didn't have time to write an essay on why, probably having eleventy-seven other caches to review, but clearly he didn't convey much information as to the reason for the cache being archived.
The OP, understandably, views that his cache has been rejected out of some old-boy elitism against the new fandangled iPhone members of the community and, after failing to elicit a reasonable response from the reviewer as to why, he gets shirty.
It turns out that the OP's ONLY mistake was to use the wrong tools for the job. He used Google Maps on his iPhone and not a proper GPS application such as MotionX or indeed the official Geocaching App.
Is his enthusiasm and subsequent outburst at his perceived rejection really such a crime?
A new member shouldn't be chastised for making a mistake, their enthusiasm should be embraced, they should be helped and (quite literally in this case) pointed in the right direction.
Also, this has highlighted the fact that there does actually seem to be some elitist element by the dedicated GPSr old-guard against the newer iPhone users.
Remember, the iPhones will have better chipsets than older dedicated GPSr units. Just because some people can play Doodlejump or make phonecalls on their devices as well as find geocaches doesn't make them any worse or less valid a tool.
Every community needs new members. I've only been doing this for a couple of months, I started with an iPhone and found it perfectly acceptable (except under heavy tree canopies, but then who doesn't have trouble under the trees). I've been very active in my area and have gained a bit of a reputation because, as you can probably tell, I'm awesome. I've since bought a Garmin Oregon (which arrived today), and I have several prototype caches, with hours of build-time behind them, being tested for weathering before I put them out. If I'd had the same experience as the OP at the very beginning I'd probably be a bit miffed too, and would have knocked the whole thing on the head there and then.