Someone has been going around the blogs posting a quite detailed and plausible rebuttal to the allegations raised by Italian TV and noted here under the title US Admits White Phosphorus Use In Fallujah. The core of it is that the white phosphorus artillery rounds in question are to make light or smoke, and that in any ordinary case you are more at risk if the cannister lands on your head than you are from the phosphorus itself. You can see a copy of it in the comments to that item, and on other blogs too. I would be delighted if this rebuttal proves correct.
Even so, alas, the other point remains: what did our bloody fighting in Fallujah achieve in the end, and was it worth the US and Iraqi casualties, not to mention the destruction of the city?