If you haven't updated your iPhone software, your signal strength bars are overstated, per Apple's letter of July 2nd:
Upon investigation, we were stunned to find that the formula we use to calculate how many bars of signal strength to display is totally wrong.
Our formula, in many instances, mistakenly displays 2 more bars than it should for a given signal strength....
We will issue a free software update within a few weeks that incorporates the corrected formula. Since this mistake has been present since the original iPhone, this software update will also be available for the iPhone 3GS and iPhone 3G.