Where to start?
Dropped calls. My experience was bad almost from the beginning. The first five calls that I made -- business calls, mind you -- resulted in dropped calls. I began my iPhone 4 experience by apologizing to my client for the phone problems. Not good. I blogged at the time that the dropped calls were the result of AT&T's notoriously bad performance at that particular location. But that's no excuse, my Verizon phones work fine from the mall. I'm done making excuses for AT&T's substandard network, and so should you.
Obviously, reception is a function of proximity to towers, physical location and many other variables, so your mileage WILL vary.
Signal loss. My next bad experience was the "death grip" issue, where simply holding the i4 would degrade its signal from a solid five bars to one or zero (my video of the flaw is here). Holding it wrong? No. The antennas are in the wrong location. Apple completely missed the boat on this obvious defect and flaw in the design. It's an unexcusable failure that I attribute to Apple's insanely secretive testing or lack thereof. I have to buy a wildly overpriced (even by Apple standards) $29 "bumper case" to mitigate Apple's problem? Duct tape on my phone? Are you kidding me?
To add insult to injury the iPhone 4 bumper case doesn't fit most third party dock cables or headphones. Accident?
Proximity sensor. My iPhone 4 constantly mutes, holds or switches to FaceTime when it touches my face. Clearly a problem with the iPhone's proximity sensor. Again, be prepared to return phone calls and apologize for the device.
Update: For some, resetting the iPhone's settings helps mitigate the problem -- not so much for me. Try Settings > General > Reset > Reset All Settings or Settings > General > Reset > Reset Network Settings. I posted a follow-up blog post about the iPhone 4's buggy proximity sensor here.
Custom ringtones. I had to fight with my iPhone to get my custom ringtones to sync and since then it's been downhill from there. My ringtones keep playing in a stuttered loop after I answer the call. I hear a garbled version of my ringtone ringing after I answer the call. The only solution is to hang up and call the person back. Again "I'm sorry, my phone was acting up." I've also had trouble playing the Apple ringtones in Settings > Sound > Ringtone > Standard, they stutter and skip horribly if my iPhone hasn't been rebooted in the last 24 hours.
Battery life. For the all hype around battery life on the iPhone 4, I'm not seeing it. I charged mine overnight, unplugged it at around 8 am and got the 20 percent battery warning before 6pm. I wasn't using it excessively mind you, nothing out of my normal usage pattern (brightness at about 50 percent) but I was using Wi-Fi and Bluetooth intermittently throughout the day. Tech Republic's Jason Hiner writes about it here.
Update: In all fairness, the battery has been pretty good since restarting the phone. The above example was only from one day (maybe the BT drains it more than I thought?) Since then (and restarting my phone daily) the battery has been as good or better than my iPhone 3GS - easily lasting through a full day.
There's also a weird screen-locking behavior based on my settings in Settings > General > Auto-Lock. Instead of simply turning the screen black and locking it (as it did in iOS 3), mine switches to the ominous black Apple logo screen with a spinning wheel overlaid on its bottom third, then it goes black and eventually to the lock screen. This makes me think that my iPhone is shutting down or restarting every time it happens. This may just be a new iOS 4 behavior that I'm not used to.
I'm going to wait until the end of the week to see if Apple releases a firmware update addressing any of these issues. Then, this lemon is going back to the Apple Store that it came from. Which is a bummer.