I'm underwhelmed. I think about how yucky my Razr screen gets and it's not even a touchscreen phone. More over, if we look at this as The New iPod, everyone is missing one huge feature. 802.11 in an iPod. So, now what? Will there be music share a'la Zune, or will it only be usable for web/email use? This is *huge* and it will remain to be seen if Apple will even use this feature. (Personally, I suspect there will be a version of the iTunes store for the iPhone and that is what the wifi + iPod will be used for. Buying new music and video, not sharing. It will be interesting to see how big a cut Cingular would take from such a store as it would eat into their cash cow: ringtones and phone games.)
I guess having a PDA with a good screen and a good UI (if touchscreens turn out to be "good") is nice, but I used PDAs for years and switched to a laptop and have no desire to go back.
As for having an iPod+phone, it's bigger than my current phone and I already have a 20 gig iPod and an iPod shuffle. I use the shuffle for short jaunts (walking to class) and the big iPod for car trips, airplane trips, etc. The iPod feature of the iPhone doesn't serve a purpose for me.