Personally I try to use 960 for the width. the argument for using 960 was it’s divisible by 3, 4, 5, 6, 8, 10, 12, 15, and 16 which means your grid options are endless, and of course it fits within the most popular 1024 width.
HOWEVER With the soon to be released I-Phone 4 working on an incredible 960 by 640 pixel maybe it is time to look at adjusting this slightly to accommodate the latest IPhone. 50 million I-Phones have been sold since it’s release in 2007 so the market for the new version is looking good.
Now of course people will say you should be building to work on multiple platforms with varying resolutions and to them I say try the real world!
Most graphic designers open up a default PSD file that is set to around 960, this is what they see and what the client sees to sign off. So a slight decrease to fit the frame of the IPhone will mean a horizontal IPhone 4 will be able to display your website in the original look with no horizontal scroll bars which for 20 pixels is just annoying.
I would be interested to know your thoughts…