I think, as a first time effort, its definitely not bad.
The iPhone, on the other hand, nailed it in terms of design and UI on the 1st gen phone, but even now on they 2nd gen phones the bugs are still annoying. Also, the 1st gen iPhone looks way cooler than the 3G.
I think I'm going to stick to my Samsung i608 (or Blackjack/i600 to American folk) because I love the keypad, its slim, light and is very functional. I know Windows Mobile isn't everybody's cup of tea, but I find Windows works really well for what I need, especially in running engineering applications (One of the reasons that stopped me from buying a Macbook).
One thing that annoys me is google seems to be leaving too much of Android up to the 3rd party developers, which isn't a good thing since there needs to be a sound framework from which others can than work on. In other words, not everybody can be bothered looking for 3rd party applications, and google has to step in here to fill this gap to ensure less savvy users can still enjoy their android handset. Also, What can you only use one gmail account with a phone unless you reset everything????
Speaking of which, has Android been transplanted into the O2 Atom or blackjack yet?