Oh my GOD!!! This is awesome and proves that it can be done. 

Not sure why Apple didn't include this in the first place.

Video Recording APP 

Records 5 seconds of Video at 10fps and then plays it back straight away

Currently there is no UI, Preferences, Sound, Save or Stop/Start - But bare in mind it is the first release!

This is more of a "Proof of Concept" at the moment but the quality of the video is fantastic.

I can personally confirm that this works on fw 1.1.2 but others have reported success on 1.1.1 and even 1.0.2.

You can install it manually or read more about it from the source here

*NOTE* If you install it manually you MUST make sure you set the permissions of the app and all it's contents to 0755 you can do this using mobile terminal and typing the following once you have uploaded the files: chmod -R 755 /Applications/Drunknbass.app/ 

Alternatively you can add http://limitededitioniphone.com/lei.xml to your installer source list and download it from there. (I am not sure if they will keep it updated when new versions come out so you may want to register on the developers site to receive the updates)