A major update to the iPhone’s firmware arrived at the stroke of midnight Thursday, surprising Apple AAPL watchers and taking just a little steam out of the Friday launch of Research in Motion’s RIMM BlackBerry Storm.

iPhone 2.2 contains dozens of fixes and improvements — most of which had been telegraphed in advance through leaks from the developer community. Apple’s handy checklist:

  • Enhancements to Maps

    • Google Street View
    • public transit and walking directions
    • display address of dropped pins
    • share location via email
  • Enhancements to Mail
    • resolved isolated issues with scheduled fetching of e-mail
    • improved formatting of wide HTML email
  • improved stability and performance of Safari
  • Podcasts are now available for download in iTunes application (over Wi-Fi and cellular network)
  • Decrease in call set-up failures and call drops
  • Improved sound quality of visual voicemail messages
  • Pressing the Home button from any Home screen takes you to the first Home screen
  • Preference to turn on/off auto-correction in Keyboard Settings

No. 1 on that list — Google Street View — is the first new feature we tried out. It also happens to be the most conspicuous trick that Google GOOG Android phones performed that iPhones couldn’t.

Well, now they can. For example, here’s the street where Steve Jobs works, as seen through an iPhone sitting 2,944 miles away:

One caveat: The iPhone lacks an internal compass, so it still can’t deliver Google’s vaunted Compass Mode, where the view changes as you swing your smartphone left and right (see here).

For more on what the update offers, see here. To download it, plug your iPhone into your computer and click on Check for Update. iPhone 2.2 weighs in at 246 MB and installs in less than 10 minutes.