I'm a bit late joining this discussion, but I have to say that I absolutely love my iPhone (I was late joining that bandwagon too). The massive range of apps is one of the main reasons for this, and a major reason for why I wanted it, but why not? Anything that adds to the range of functions a product has can't be bad.
But the quality of the sound you get on phone calls is fantastic and network coverage (for O2 at least) is brilliant. The only places I've managed to cause it problems are deep in the Cotswolds and miles away from anywhere in the Highlands - even then the signal was simply unreliable and never went for long. And now there's even a choice of operators so you can probably find one to suit any location.
I've dropped it a handful of times (from about 5 feet off the ground due to not being used to the shape or getting used to the case I have) and nothing's gone wrong yet. I've jailbroken it both successfully and unsuccessfully, and iTunes never fails to restore factory settings without a hitch.
So er, yeah, that went a little long. But you get the jist. I've not used that many other smartphones, but I've tried a couple of Blackberrys and some new Nokia and Samsung things and while they offer a lot of the same functions it comes down to the selection of apps to make the deciding factor. Everyone in my band got an iPhone after trying somebody else's