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AppleInsider cannot offer any verification of the authenticity of the video provided, but it claims to show a handset built for testing purposes that allows developers to choose between the SGX535 GPU found in the iPhone 4, and the faster SGX545, which has not yet been seen in any of Apple's mobile devices.
The PowerVR SGX535 GPU from Imagination Technologies currently handles graphics for the A4 processor that powers the iPhone 4. But the A5 processor found in the iPad 2 has a SGX543MP2 GPU, different from the "545" model shown in the video. The SGX543MP2 has two SGX543 cores.
Update: A second video provided shows the "About" section of the iPhone Settings application. While the original, unedited video was provided to AppleInsider, it has been cropped to mask anything that might uniquely identify the handset.
The SGX545 GPU was first unveiled in January of 2010, boasting full support for OpenGL 3.2 and OpenCL 1.0 with real-world performance of 40 million polygons per second at 200MHz. For comparison, the SGX535 can produce 28 million polygons per second, while the SGX543 pushes 35 million polygons per second.
But the SGX543MP2, with two SGX543 GPUs, is capable of nearly 70 million polygons per second, which would make it much more powerful than the single SGX545 claimed to be in the prototype.
While the video claims to show a prototype iPhone, the hardware displayed looks identical to the currently available iPhone 4. It's possible that the graphics switching functionality, shown accessed through the iOS Settings application via the Developer Settings section, was enabled through a hack, or has been faked by some other method, such as a jailbreak.
As for the GPU differing from the A5 currently found in the iPad 2, it would not be a new approach for Apple to modify and improve the processor in the iPhone. For example, the A4 found in the iPhone 4 has 512MB of RAM, which is twice that of the A4 found in the first-generation iPad released months before the iPhone 4 was unveiled.