I've had mine for a few days now, here's my initial thoughts (will post a few pics + a desire/iPhone/HD7 comparison later)
First of all software.
Motoblur is truly dreadful. Not just bad but shockingly bad. 5 minutes after turning it on I thought they'd sent me a resistive screen/200 Mhz/48Mb LG cookie, circa 2007.

(T-Mobiles demo model must've had everything stripped out)
How can anyone, from junior software engineer to boardroom executive, think they're doing a good job is beyond me.

For the average person motobloat will turn Android into an old build of Symbian, so stay clear if you don't like fiddling around with your phone or want a nice/easy introduction to Andriod (SenseUI is on a completely different level)
There are a few saving graces.
The standard multi touch keyboard is one of the best and you get Swype.
DLNA is a nice addition for media streaming.
Inbuilt battery profiles and data counter.
There's wifi hotspotting too (standard on 2.2 but makes 2.1 more bearable)
...that's about it. Oh, the music/video/FM player is ok but its completely outclassed by powerAMP and the rest.
Luckily the hardware is great and once launcherPro and your fav apps are installed normal service is resumed (with minor lag from all those bloat process you can't properly close)
The screen is a decent IPS LCD. Sharp, bright and great colours. It would've been up there with the iPhone 4 if there was less depth between the panel and glass. Certainly better than standard/super LCDs currently floating around.
Love the small form factor too. Can't wait to root, remove the bloat and overclock!
How do I remove all the crap and make it sexy?
The XDA defy forum is a good place to start.