I believe there's someone working on a completely different iOS client that looks pretty snazzy, but they haven't got any public code in their repo yet.
In America it is illegal to make a currency that competes with the USD. Congress will eventually rule that Bitcoins do compete with the USD and then yes it will be illegal.
Yeah, it would be a bit much to call what I have so far a startup too, but I'm hoping to do a lot of work on it over the summer. Hit me up on IM or email at anon754268@gmail.com.