At $85, it's not exactly a recession special, but Substrata's zebrawood iPhone 3G case is among the prettiest. Here's the pitch:
It is designed to add a natural aesthetic to your iPhone 3G, while protecting it from scratches when it is in your pocket, purse or bag. The contours are shaped and sanded to compliment the curves of the iPhone and the interior is sized to hold it snugly. This one of a kind case would make a wonderful gift for the iPhone user.
Wood iPhone Case - Custom handmade box for iPhone 3G [Etsy via 7Gadgets via Oh Gizmo]