I have a exact same dilemma with a new site that I want to build.
From other sites I've done I can guarantee that the searchphrase.com approach is a fast path to Google love...scary fast.
I don't have an existing site to worry about, but my searchphrase is longer than I would like. i.e. for branding off-internet, for user memorization, for t-shirts on big-busted promo girls, etc.
But it gets LOTS of searches and just about everyone searches it the exact same way coupled with their city name.
Search phrase = 5 words (including a one word city name).
Ideal domain for a billboard = 2 words (one being the city name)
So I'm trying to figure out how to do both at once as well.
It's not just gaming the search engines. It's really like two different demographics that want two separate things.
If I had to pick I'd take the searchphrase.com and forget the other, because most people are looking there first (but the promo girls may prove to be a close second and none of them can properly fill out a 5 word t-shirt ;o)
If a user is searching for "Flordia disease resistant green apples" on Google, both Google and the user want to see a result FloridaDiseaseResistantGreenApples.com , because the 99% chance is that it's exactly what they're looking for (or crappy parked page I guess)
but if they're driving down the road FloridaAppleInfo.com makes a better billboard, and they will suspect that their info is there even though they don't appear to be searching that way.
So how can you promote both without having to build an enormous amount of work building parallel content all the while trying to make sure that it is not duplicate content?
Or can you just promote the GreenAppleInfo.com offline and somehow do a smooth transparent handoff to DiseaseResistantGreenApples.com which you SEO?
Hope I didn't hijack your thread. It seems like we're looking for the same answer