What's the purpose of iPhone USB port on the Internet Sharing panel?
This panel that you are viewing just shows all available network interfaces, whether they work or not. Theoretically it should work. However, I don't think it works Mac to iPhone but I have tested it reversed with Personal Hotspot and it seems to work. Albeit very slowly.

Hope this answers your question.
Cheers! :)

UPDATE:
The iPhone USB network interface is only for showing whether iPhone USB is connected or not. As a side-effect it shows up in the Network Sharing pane.
The Network Sharing pane just shows ALL interfaces whether they work or not (even if the interface is not meant to work with Network Sharing it will still show.)