According a blog post by developer Angelo DiNardi his MailRangler app was denied entry in the App Store because of "duplicate functionality." The exact reason given was that MailRangler:
duplicates the functionality of the built-in iPhone application Mail without providing sufficient differentiation or added functionality, which will lead to user confusion.
DiNardi explained that MailRangler includes functionality that is actually quite different from Apple's included Mail application, mostly in the way that it handles Gmail accounts.
Basically this app enabled a user to add their GMail accounts (standard and Google Apps For Your Domain) which they could load and switch between them quickly. It embedded Webkit in to the app and logged you in to the accounts automagically.
He also mentions a similar app for the Mac desktop called MailPlane.
Two weeks ago Apple disallowed Podcaster into the app store because it duplicated the functionality of their iPod application.