Preview at WWDC likely in June, followed by September launch.
Apple to Offer iTunes Remote Control App for iPhone and iPod Touch
iTunes 7.7 settings for iPhone Remote
Apple released a pre-release version of iTunes 7.7 for developers tonight. In the Read Me of the iTunes installer is a hint at a previously unannounced iPhone/iPod Touch application:
Use iTunes 7.7 to sync music, video, and more with iPhone 3G, and download applications from the iTunes Store exclusively designed for iPhone and iPod touch with software version 2.0 or later. Also use the new Remote application for iPhone or iPod touch to control iTunes playback from anywhere in your home -- a free download from the App Store.Apple reveals that they will be offering a free app on the App Store that allows you to remotely control iTunes in your home from your iPhone or iPod Touch. The application will presumably work under Wi-Fi to control playback of iTunes.
Apple has previously patented methods to implement such an iPhone Media remote control.