iBooks Author is an amazing tool for laying out and publishing ebooks to iTunes. Unfortunately, the application creates books that are only readable on iPads. You trade off fantastic page design (via Apple's proprietary .iBooks format) for a much smaller potential reading audience.
When you want readers to be able to peruse your book on iPhone, you'll need to go with EPUB format instead. For all its faults, Pages still offers the best tool for creating compliant iTunes EPUB submissions that pass submission validation.
Steve and I have been hard at work on a couple of books
