The best use that I could think of for an old iPhone was to put it by the front door (more specifically, the coat closet) so that it could tell me the weather.
I molded a custom dock out of InstaMorph/Shapelock plastic, dyed with an epoxy coloring agent (Evercoat, I think). It can be a messy operation if you don’t do it right, and I’ll leave it to the reader to find out what the correct method is. The phone is running a weather app by Yahoo, which is interactive and beautiful.
It does the job perfectly — you can read it from 10 feet away and the scrollable interface includes everything you’d want to know about the day’s weather.