Rogue Amoeba has taken things one step further with the release of Airfoil Speakers Touch [App Store, Free], which allows audio to be streamed from a host computer directly to an iPhone or iPod touch. While Airfoil Speakers Touch is a free application, it does still of course require the full version of Airfoil running on the host computer in order to function.
With Airfoil Speakers Touch, you can send any audio from your Mac or PC, straight to your iPhone or iPod Touch! Just connect your device to your local Wifi network, then open up Airfoil on your Mac or Windows machine, and start transmitting. You'll be able to send audio from iTunes, RealPlayer, and even web-based sources like Pandora and Last.fm. Now, if your Mac or Windows machine can play it, you can hear it on your iPhone or iPod Touch!