I don't have a GPS phone, but I've had long chats with friends who do about GPS accuracy, and they seem to confirm this --- 10-20 metres is typical outdoor accuracy. They add a couple of ifs. First, you may need to wait fairly long, maybe 10-15 mins, to get this accurate a fix specially after a long off-line gap, because a lot of cached data inside the phone needs to be validated with the satellites. Second, they say that this accuracy is possible only if satellite reception is acceptable, which it is not in some situations, typically indoors.
In the absence of these two factors, you'll get position data from cellphone towers (AGPS) which will be +/- a few hundred metres. This is typically what a newbie "GPS user" sees with his phone. When the first Motorola Milestone came to our office, I remember this is what we all used to see, till we did all this knowledge gathering and re-tried.
Shuvam