I haven't had any problems with this until I upgraded to iTunes 10.1.0.56 and upgraded my iPhone to 4.2.1. After doing so, whenever I plug in my iPhone, it never appears as a device in iTunes. I have uninstalled all of the iTunes apps according to Apple instructions (correct order) and re-installed several times, but to no avail. I have rebooted my computer, turned the iPhone off/on several times, reset the iPhone using the sleep / wake / home buttons and it still will not appear in iTunes. When I plug in my iPhone to the computer, it is recognized by the computer as an imaging device in Device Manager and pops up a window showing that an Apple iPhone camera has been detected, but it has always done that.
Oddly, I installed iTunes on a Windows 7 PC (which may be completely irrelevant) and iTunes does recognize my iPhone. I eventually want to move all of my media to the Windows 7 computer, but I want to do one last backup before doing so. Horrible time for this to happen.