iPhone OS 2.0.2 is causing a serious issue, in which some third-party applications crash or do not launch, for many users. This problem is generally accompanied by another in which music and other media are erased from the iPhone.
The simplest fix to try: erase one application, then re-download it. Apparently this process can correct DRM issues that occur after the update.
Failing that, the following fix will may for this problem: Connect your iPhone to your computer then select "Restore" in iTunes. When prompted, choose to set up the device as a new phone. You will lose any stored passwords and need to re-transfer any media.
In other cases, you may need to delete the actual update files, then re-download and restore. Delete the update files, located in ~/Library/iTunes/iPhone Software Updates under Mac OS X or C:/documents and settings/[yourusername]/Application Data/Apple Computer/iTunes/iPhone Software in Windows. Next, restore in iTunes as described above.
In other cases, the issue can only be resolved by downgrading to iTunes 7.7.0 for Windows or 7.6.2 for Mac (from 7.7.1) and re-syncing the device. Follow this process: