Ok, I think they are asking you to make an object and pass that so the response to the service. Eg:
public class MyDto
{
public string Name {get; set; }
public string Id {get; set; }
}
//service signature
public MyDto GetData() { . . . }
The response gets encoded as an xml string, but the generated WSDL will help the iPhone guys tooling create an object for you rather than manually parsing the XML.