How did iPhone 4 know to switch timezone in Airplane Mode?

I have both an iPhone 4 (from work) and an iPhone 3GS (personal). Today I took a cross country flight from BOS to LAX. Upon boarding the plane this morning, after having stayed up all night packing (and procrastinating from packing), I stowed my bags, put my iPhones in Airplane Mode, and promptly fell asleep. When I woke up after what felt like a long time, I checked the time on my iPhone 4 and was disappointed that only two hours had apparently passed. Then I flipped on the flight map and was surprised to see that we were soon to descend into Los Angeles.

Somehow, despite being in my pocket in Airplane Mode the entire flight, the iPhone 4 had adjusted its clock to the Pacific timezone. Meanwhile, the iPhone 3GS had not. It was still on Boston time.

How did the iPhone 4 know to do this while in Airplane Mode?

Since your phone is a Verizon iPhone, it got the time from the cell towers. (Verizon, along with Sprint and unlike AT&T and T-Mobile, uses CDMA which broadcasts the local time from the cell towers.)

It must be that Airplane Mode is actually "don't transmit" mode instead of "don't transmit or receive" mode as I'd always assumed.

Edit my reasoning:

1. I know that CDMA phones get the local time from the cell towers (if you're driving, you can watch your phone switch time zones as you cross the border).
2. I also know that cell towers broadcast their availability so they can be found by phones. It makes sense, then, that the time signal might be in this broadcast signal.
3. One of the reasons Airplane Mode exists is to prevent transmissions from potentially disrupting aircraft systems.
4. Turning off transmit functionality does not necessarily preclude receiving data. Leaving receive on may actually be a benefit, as the phone can passively monitor cell towers in the area so as to know which one it wants to talk to when/if Airplane Mode is turned off.
5. If you're passively listening to the towers already and they're broadcasting the time anyway, it would be logical to update the system time to whatever local time is since you already have the data available and you can give the user the most accurate information possible.

Wi-Fi can be enabled even in Airplane mode, maybe your flight had Wi-Fi in it and your phone connected to it?

GPS... My guess is your phone got an update from GPS satellites and when it fixed it's position it realized it was in a new timezone and made the change to the internal clock.

All GPS signals contain encoded time data, as the correct time is required in order to triangulate and determine position.