Same problem here. I live in Peoria AZ & work in Phoenix AZ. When I'm at home, the clock widget shows "Peoria" & 1 hour ahead. The taskbar still shows the correct time. I'm guessing it thinks it's in Peoria IL, since it does not list Peoria AZ in the list of cities. When I go to work, it changes to Phoenix & corrects the time back.
We do not observe DST in AZ, so I hope that's not going to be an issue. My previous phone was the HTC Touch Diamond, & it had a HUGE problem with that, despite having a specific setting for "AZ."
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