I've used iPhones and I have an iPod Touch. I love the interface, and I dig the device. Initially, I had to resist the urge to just buy an iPhone and deal with these problems, but I didn't, opting to get a Nokia N95 instead. A year has passed, and I've realized that I definitely made the right choice -- the limitations of the original iPhone (and the iPhone 2.0) are simply too numerous. Perhaps I've been spoiled by my N95 (and truth be told, I'll be getting an N96 in the next few months), but no matter how you slice it, I've decided that the iPhone just isn't my cup of tea. Here's why:
1) Lack of a full Bluetooth stack
This really bugs me. With my N95, I can use the phone as a Bluetooth modem for my MacBook Air when WiFi isn't available. I can sync it with my Macs (and Vista box) for contacts and calendaring. I can use Bluetooth headsets and headphones. I can easily (though not speedily) transfer files, images, videos, whatever. I can even use my collapsable Bluetooth keyboard. The iPhone's Bluetooth capabilities are capped at headsets. You can't even use Salling Clicker with the iPhone. No thanks -- that's too much convenience to give up.
2) No video camera
I haven't used my Canon video camera in ages. I prefer to grab a few minutes of video with my N95, or my Canon Elph when the mood strikes. My N95 is always with me, and takes surprisingly good videos. Lacking this feature would drive me nuts the first time I wanted to take a video and couldn't. What gives?
3) Lack of expansion
My N95 allows me to use micro-SD cards to add storage. The N96 will support them too, along with a 16GB internal storage capacity. This is a no-brainer.
4) Built-in battery
I can live without a removable battery in my MacBook Air, since I always carry the charger with me when I'm traveling the battery life is reasonable, and I don't use it while driving. The MacBook Air is also a laptop, not a phone, so it's not powered on 24/7/365 like my phone. I have a few batteries for my N95, and can swap them if I need to, no muss, no fuss.