Developing alternate sites is a big job, so only worth it if it's a big site and there's a lot of $$$ involved. Browser sniffing is not well regarded these days. Using CSS3 media queries is a nice option for iPhone (but I'm not sure about Droid).
There is a fairly recent argument that the best approach is to make a clean, simple site with basic styling, and feed special media styles to devices that can handle them, like iPhone and modern desktop browsers. It's an interesting argument.