Well, it's early days really, given that I've only had iOS 5.1 on my iPhone for a few hours. However, given that I noticed the initial battery bug within hours of installing iOS 5, and then I quickly realized that iOS 5.0.1 didn't fix the problem a few hours after installing it. You don't need to spend a long time with iOS updates to have a pretty good idea of how they affect battery life.
Normally my iPhone 4 has been discharging around 15 - 20 percentage points off its battery life overnight on both iOS 5 and iOS 5.0.1. This has been a consistent and repeatable pattern for week now.
Last night I noticed something different. Overnight battery discharge was only 6 percent. That's not just an improvement, it's a significant improvement. This leads me to believe that this update does indeed squash whatever battery bugs were in iOS 5/5.0.1 (at least the battery bugs that were affecting my handset).
I'm also noticing my handset drain at a much slower rate when it's out of the dock and when I'm using it. Simple actions such as downloading email could knock a percentage point off the battery, which was behavior I didn't see prior to iOS 5, and it is behavior I'm not seeing with iOS 5.1 now.