Well actually you CAN get iTorque and import the Blockland .exe to run on iTorque and there you have Blockland for iTouch/iPhone! GIMME A COOKIE!

And you are right you can put Blockland onto a Java applet but some things might not work:
Server Mods
Character Mods
Projectiles (Have to use the gun projectile)
AND YES YOU CAN GET ADD-ONS ONTO A ITOUCH/IPHONE!!!
DON'T ASK ME HOW BUT A FRIEND OF MINE MADE BLOCKLAND ON IPHONE AND SUCCEEDED IN ADDING ADD-ONS WITH JAVA! HE HAS NOT RELEASED IT SO DO NOT ASK ME FOR A COPY!I DO NOT HAVE IT! HE DOES!