Space Ace is exactly like the old arcade game except you have to tap the arrows and button on the screen instead of moving the joystick and tapping physical buttons. It's amazing what they can fit onto a phone now considering this game and Dragon's Lair used to run off of a laser disc.
They haven't come out with Dragon's Lair yet for the iPhone but I hope they do as that was a great game. I remember losing a lot of quarters and making no real progress in the arcade with these games.