Touchpad for iPhone is an unofficial application for the iPhone (or iPod Touch) that allows you to use them as a wireless touchpad.
You can control the mouse on your PC using just your iPhone. You can move the mouse around, click, double-click, and even drag (double click but keep it pressed and then move around). Vertical scrolling is even possible, by click-and-dragging on the right edge of the iPhone screen.
You can use it to control videos, show pictures, advance slides in a presentations -- whatever a regular touchpad can do.
The author provides this Youtube video demonstrating the application:
1. Start Installer.app, and go to Sources. Click "Edit", and then Add this repository: http://cnp.qlnk.net/
2. After the refresh, install Touchpad from the Utilities category.
3. Install VNC on the machine you want to control. I recommend TightVNC for Windows and Linux and Chicken of the VNC for Mac.
At the moment, you need to have a hacked/jailbroken iPhone to use it.