I use Toodledo currently with the exact same setup as PeterW.
I find the biggest strength with Toodledo is also its biggest weakness - the fact you can set it up in so many different ways.
Great because you can (hopefully) find a set up that has everything you need. Bad because Toodledo wasn't designed with GTD in mind so you end up with a lot of workarounds.
I'd tried a lot of times to get Toodledo working
for me before I found a setup that works - go to the Toodledo forum and look for Proximo's GTD setup. He has really thought it through nicely. I had deserted Toodledo for Nozbe, but this brought me back again. This works well both on the Toodledo web and with Todo iPhone app.