I'm currently stuck in phone number porting purgatory until tonight, it takes up to 24 hours to port a phone number from another carrier - not 6 hours like they promise. In the mean time I've been "setting up" my wife's iPhone and she'll get it back some time tonight.
The photo viewing app is enough to justify its purchase. It is so incredibly fast and fluid. There are 20 hi-resolution thumbnails that fill every inch of the screen and you just flick with your finger and they slide by so fast "like they are all on a skateboard" as my Friend Stuart says.
Photo scrolling has no lag, no pixelation and it syncs with Aperture. Just tap on any photo and it displays in full screen mode which you can twist to widescreen by turning the phone on its side. Either tap or reverse-pinch any part of the photo to zoom in even further. That alone is worth the price, especially when you have a baby. iPhone is the ultimate baby photo album.
The bundled Safari Web browser is also worth the price of admission. It even works with Google docs (although read only, for now). The iPod is awesome - as you'd expect from Apple. Seeing all your music in Cover Flow mode and "flipping over" the album cover to see the "back" of the album to pick the song is a stroke of brilliance. Reminds me of looking through my vinyl collection.
The only knock so far is that AT&T coverage is a little faint in my house 2-4 bars (out of 5) and EDGE data is a little pokey. But that's more than made up for by surfing on WiFi instead which absolutely screams.
My other problems (so far) are mostly with the Calendar application. It sorely needs: week view, landscape mode and colored calendars. If you have multiple calendars and live in iCal you'll be a little disappointed.
My last feature request is streaming music via AirTunes to an Airport Express via the WiFi connection. That would be the ultimate for a mobile DJ. "Got an Airport Express set up? Cool, Check out this track..."
I have no hesitation recommending it. 5-stars.