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When I plug it in a yellow triangle pops up that says "This accessory with not charge this phone" or something along those lines, I'll make a screencap of it later.
Today I bought the Belkin TuneBase FM for $99 and it is great and works with my V1. The guys at the Apple store said it should work fine with 3G. It is simplistic , no wires and very functional. Clear sound, occasionally I changed the station for the FM, but always had a great sound. The best part is the cradle has a heavy adjustable arm that lets the iPhone sit just as you position it, vertically or horizontially for video. It comes with additional holders for all of the iPod incarnations too. I am planning a road trip this weekend and this will work great for listening to some Audible books.
I had the same problem with my Belkin charger. I went into Apple and then employee there gave me a half-thought out answer so I just got another charger, it was $20, so not too bad.
and it works great with my iphone 3g.
doubles as a car charger and fm transmitter.
when i plug it in.. it says it's not compatible.. but it is.. they just lie HAHA