I've got to say too, that I had a play with the ipod Touch a couple of months ago and the interface was very slick and fast and easy to use. But I couldn't get past the fact the interface wouldn't look out of place on a kids toy, yes it makes it easy to use but it's not imaginative at all, just rows and rows of boxes.
My issues with the iPhone (which lets face it is pretty identical to the iPod (have used the iphone briefly too)) are, in order of annoyance:
Features - probably partly fixed with the new software update, but hardware wise it still has a loooong way to go.
Interface - As I said, good interface, but boring design, change the interface to something more "interesting" and it would be a winner (I love the touch flo on my Touch HD because of the seperate pages you can instantly flick through, and variety, instead of just pages of squares

)
Looks - Just don't like it, never had particularly liked Apples styling except for the Mac Pros and the now iPod nanos (bright colours).
Price - When they get it off the stupid exclusive contracts with such poor extras it would sell quite a bit more IMO.
Anyway, until those issues have been fixed, for me the iphone is still a long way down the list of desirable phones.
