I got this to work doing the following:
1. Go to your Pictures folder (~/Pictures).
2. Hold down the Control button on your keyboard, click the iPhoto Library file and select Show Package Contents.
3. Locate the iPod Photo Cache folder and delete it.
Then unplugged and re-started my iPHone
then synced my iPhone using iTunes
then repaired disk permissions on my mac
then opened my iPhoto Library file (show package contents) and found a second .iPhoto (library data) file. It was called Library6.iPhoto, and it seemed redundant, so I moved it out of there.
When I next started iPhoto, it found my iPhone. My friend's phone (which isn't connected to my computer) still appeared to be there, which is annoying, but I was able to get to my phone's photos. I hope this helps. Wish I knew which step did the trick...