I had a look at my friend's phone yesterday. It is pretty impressive. It has a better look & feel than my iPhone 3G.
The things that stands out:
1. the photo gallery connects to picasa and gets the photos for you
2. the navigation app is really good
3. camera/flash is impressive for the device of its size
4. virtual keyboard better than iPhone 3G.
5. track ball is pretty useful
6. the screen appears to have a higher resolution (than iPhone 3G) and very sharp
The four functions on the bottom of the screen are not very responsive, atleast from my experience. There is no pinch zooming. It is very hard to not have it once you get used to it.