As mentioned in a previous article by Rama Krishna the memory issues in iPhone OS 3.0 relating to UIImageView can be reproduced easily. And here is such a re-production. You can download the iPhone sample application and see for yourself what the problem is. Just open the project, build it for the device (not the simulator) and run it with Instruments (ObjectAlloc) to see a nice little upwards running ramp developing on screen.

Oh!! but remember to run the app on iPhone OS 3.0 and not on iPhone OS 3.1 (the bug has apparently been patched for this version)