Functionality aside (it's been beaten to death), when has anyone stood in Best Buy and heard another say "show me the tiniest flat panel TV you have"? How many folks pine for their 12" (or smaller) monitors? Even laptops have gotten larger (netbooks the notable exception). It seems consumers gravitate (for the most part)to as big as they can afford, or can carry.
So why the I-Pad or netbooks for that matter? IMO a big part is the cool factor, you don't really need a big screen to check e-mail, but let's face it when it comes down to it, do you really want to view your photo album on a Blackberry or watch "Avatar" on your I-Phone (yes, I realize the I-Pad is larger)? IMO this is just a gadget for someone that has to have it, for whatever personal or social reasons. As mentioned, it can't, in it's present form, sufficiently replace the things we do rely on daily. I'm sure if the I-phone is any indicator, Apple has banked on its faithful customers to buy I-Pad gen 2 the moment it comes out. This seems to perpetuate the feeding frenzy.
IMO it's unlikely to replace laptops that can be had for less than half the price. Cool if you want or have one, for me it would just be a partially redundant, unnecessary piece of hardware. Might be great for the 007 types. We'll need to give it a few more years to see if it improves enough to consistently impact more conventional hardware available , its best features (quick connect?) are shamelessly cloned elsewhere, or if passes as a fad. Nothing can really be bad as long as it advances ideas for the future.