I had very high hopes for iPhoneOS 3.1 in the AR arena. With all the hype about it, I naturally thought that with 3.1 developers will be able to bring marker-detection AR to the app-store - meaning, using legal and published APIs. A look around 3.1's APIs I wasn't able to find anything that will allow this.
Not all AR is banned. In fact AR apps like Layar will be very much possible, as they rely on compass & gyro to create the AR effect. These don't require processing the live video feed from the camera, only overlaying data over it. This can be done easily with the new cameraOverlayView property of UIImagePickerController. All you need to do is create a transparent view with the required data, and it will be overlaid on the camera preview.
Sadly, to get marker-detection abilities developers must still hack the system (camera callback rerouting), or use very slow methods (UIGetScreenImage). I can only hope apple will see the potential of letting developers manipulate the live video feed.