Earlier quoted context omitted.
I'm pretty sure that iPhones have encrypted their data since the 3GS. That's how they "remote wipe" it. They send a message to the phone to delete the encryption key.
AFAIK the encryption key is stored in plaintext unless you also set a passcode (many people don't), and even if you set a passcode, most of the time it's just a short number that would be trivial to brute-force in an offline attack. Of course it's also possible to use eCryptFS with a four-digit passcode, but it's strongly recommended against. The main difference between FBI-proof encryption and pickpocket-proof encry…
You can definitely brute force it. I saw an article somewhere (probably here on HN) addressing the fact. I can't find it, but if I remember correctly, it said something about Apple or an associated company quietly offering forensic help to police on bypassing the password. I think it implied they were using a ramdisk to brute force the encryption.
edit: Found an Ars article about Apple doing it, but it doesn't mention anything about a ramdisk. http://arstechnica.com/apple/2013/05/apple-will-reportedly-u...