Sorry to bring back an old thread, but...
Descent uses a 3D software renderer as stated.
Though, it could be a hoax, someone has posted a screenshot on the
iPodlinux Forums (pictures section) of Descent II.
Until we get some more proof, we are not sure what to believe, but we have seen some true 3D on the Nano before:
http://pouet.net/prod.php?which=25857
Again, until we get some more proof, we won't believe it, but this could be seeing what is possible on the iPod platform.
One thing I have noticed with Linux on the iPod is that things seem to run slower with it (iPod is running a Linux kernel, what'dya expect?). There is another project called rockbox,
http://rockbox.org
I noticed things are faster with RockBox (Mainly a common 3D cube demo runs at a higher FPS than in iPodlinux) which means if I or someone manages an iPod port, RockBox might be a good choice.
Of course, we aren't limited to oh, I don't know, maybe a
very stripped kernel of some sort that could speed things up?
~Conor