What you use to create the images is of little to no relevance.
It's unlikely you'll be able to use vector images, as no real engine on an iPhone can handle that well.
This leaves you with png, gif, tiff, jpeg, bmp. Doesn't matter too much and depends on what you're doing.
The real thing to realize here is now that vectors are out, what are other ways of allowing users to zoom in and out great distances while it still looking good.
A good technique, take google maps for example, or mipmaps(sort of), is to store different levels of detail and change when appropriate. If possible have images from different distances and as you zoom in swap for a higher detailed version for that tile.
This allows you to not have to have huge files loaded in for every tile at all times.
QuadTrees are a common data structure used for dealing with these situations. http://en.wikipedia.org/wiki/Quad_tree