I think that Phelps won b/c the timer said so, and that, compare with anything else, should have the highest level of accuracy.
But, I personally do not think the photo finish proves anything of significance. I think most people use it to see what they want to see. If you take a good look at that photo, I can see how others may interpret it as Phelps touching the wall first, but I don't think anyone can say that the photo showed clearly beyond any doubt that phelps touched the wall while cavic was still reaching for it. and this article on nytimes also shows the lack of significance of the photo finish:
"One last technical note. Even if officials do finally agree to release video images of the final moments of the race, we may never see one image showing Phelps touching the wall and Cavic still lunging. Since video cameras normally record either 25 or 30 frames a second and the margin determined by the touchpads in this race was a hundredth of a second, there may well be no definitive video evidence in existence to prove that the touchpad technology got it right."
http://olympics.blogs.nytimes.com/2008/ ... -about-it/so IMHO, Phelps has won the race fair and square, but to say that this photo finish proved anything or that it cleared any possible doubts seems a far stretch to me.