I am really confused about iPhone3 and iPhone 4(5) screen resolutions (please bear with me, it has probably been asked before).

I want to create my App so it runs fine on iPhone3 and my screen size is now always 480x320 Pixel. Works fine.

Now for iPhone 4 and beyound, what is the screen resolution that I should prepare the graphics for? 960x480? Or 533x800?? or 480x320 with 300dpi?

The iPhone 3 App is already done and up in the store :-)
Is it a good idea to create high-res images for the iPhone 4 APP and then use a config.lua the SCALES DOWN the hi-res images for iPhone3 users?

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application =
{
        content =
        {
                width = 533,
                height = 800,
                scale = "letterbox"
        },
}