So I had the opportunity to try out the iPhone for a day.  Overall I was impressed, but there were some very basic features missing from many of the otherwise killer apps that I would greatly miss if I was to use the iPhone as my primary PDA and phone.  Here is a brief summary:

  Pros Cons
Browsing Beautiful. No copy and paste, so no convenient way to copy that phone number from a web page into the dialer.  No support for flash or any other 3rd party extensions.  No way to change the Google search default (that I could see).  Slow over Edge -- though much better over Wi-Fi.  I found I like to browse faster than the rendering engine can keep up, resulting in waiting while the page that has already downloaded just draws to the screen.
Notes Convenient, good auto-correct feature does a lot to make up for the non-tactile interface No undo.  And no select feature either.  If you want to delete more than a few characters, you'll hold down the delete key, end up deleting too much accidentally, and look for that missing Undo key, only to give up and accept data loss.
Email Nice to have a built-in app, especially when it connects to Gmail.  Good to have IMAP support to make up for the poor "Gmail"-dedicated option. When I added Gmail, all emails came in as Unread.  No bulk method to mark them as read either, so I would have had to open each of 47 messages to mark them as read.  Also no conversation view of email as Gmail on the web has -- just the archaic individual message listing.
Overall Stability The system was responsive most of the time. Sometimes the whole screen would just freeze for several seconds for no apparent reason.  It would not respond to the one button I could press or any touch on the screen.
Google Maps Multi-touch makes this great. I actually have found Microsoft Live Maps to provide a more accurate freeway traffic condition (don't know why), so I would prefer to have Live Maps offered.
Voicemail Of course I'm happy to see an app to visually make reviewing voicemails as easy as sifting an Inbox. No cons here -- except that I rarely have more than a single voicemail message waiting for me anyway, so I wouldn't call this a killer app.
YouTube Entertaining Poor video quality -- worse than a desktop computer it seemed.  Slow downloads over the Edge data connection.
Weather Convenient one or two touch access to weather daily forecasts. Unlike the dynamic calendar button on the home screen, the weather button reports a static "sunny 73 degree" all day every day.
Camera High quality.  Cute animated shutter. Issues pressing the "take picture" button not always taking the picture.  It could cause you to miss the perfect moment for your picture.
Phone dialer Nice interface.  I actually prefer the Windows Mobile Smartphone interface because it is more friendly to one-handed use.
Keyboard I personally really like the touchscreen keyboard, especially because it affords more room for the beautiful display.  Auto-correct makes up where mistakes occur. Virtually impossible to use with just one hand.  And yes, more mistakes are made than with a slide-out qwerty keyboard. 

Then of course there's the closed platform problem, and I miss the voice-activated search I have on my Windows Mobile Smartphone. 

Bottom line

Microsoft employment aside (since I tend to not let that get in the way of my personal purchase decisions), would I get an iPhone if I had $500 and a two-year contract I cared to get into?  I'm not sure.  If I did it would be for the mobile browsing experience and nothing more.  That's not worth $500 plus a two-year contract.  Check out a recent post I did on Windows Mobile Smartphones for how I like to find inexpensive, very usable smartphones.