Quite a few people have posted in many forums that their iPhones suddenly stopped making any sound. It doesn't ring when a call comes in, no sound is made when an sms is received and none of the third party apps that produce sounds seem to be able to... produce... sound... lol. And this applied both to the external speaker and the headphones. As if I needed another thing to piss me off today.
This post suggests that the iPhone might be stuck in headphone detection mode (and some other random reasons). Their solution was to insert the headphone plug into the headphone-jack in a quick motion a few times and you will get your sound back. Knowing my luck, this did not work for me, and being as impatient as I am, I did a restore. And of course, that worked.
Now I have to install all my 3rd party apps again *sigh*.
BTW, I'm on 1.1.4 if anyone cares. The official Apple support site forum post is here.