I'm still struggling with the best way to do debugging of my PhoneGap apps. I had heard of weinre, or Web Inspector Remote, but had not had a chance to get it running locally. Turns out PhoneGap hosts a remote server you can use for your testing. It's a bit tricky to get console messages up, but in case it helps others, I've created a quick video entry on how I got things working.
Pardon the silly non-embed link above. It will take you offsite to screencast. I should just embed the SWF but I'm in a hurry. Anyway, if the video above makes sense to you, let me know.