It will dazzle
It won't dazzle this crowd, which seems to be driven by feature lists only!!! The inital iPod didn't dazzle this crowd. The only comparison that people seem to make is feature lists. This is the same mistake that was made (and still is) when discussion of the iPod took place - FM radio; without it it will die - voice recording; without it it will be overtaken, etc., etc., etc.
But the people that I see use the current SMART(??) phones effectively are primarily geeks, or they have one application they need (like the PDR on the Treo for physicians). Most of the effective users can also make linux servers stand on their head if they want to.
The problem is that the normal user can access, reliably and on a day-to-day basis, these 'SMART' features. This is where the iPhone (and it will be iPhone) shines and will dominate. Just like the iPod put the data management tasks on the computer (iTunes) and leave the data access tasks to the most elegant (years ahead of the other) UI seen on any hand portable device.
Compare the introduction of the iPhone and the Zune for illumination. Both are devices 'late' to the party - supposedly being introduced to a mature market. How does the Zune address this to differentiate itself? Add one 'new' feature (WiFi) while bunging up the rest (draconian DRM). How does the iPhone - re-examine the entire USER experience and figure how to do it more simply and, in my opinion, infinitely more effectively. Does it have every feature everyone want right now???? No, of course not its revision 1. It is 'better' that whats out there??? For the non-geek user - YES!!!!! Will it evolve, quickly, with user and market feedback - YES!!!!.
It was stated earlier in this thread that the 'mobile handset market moves quickly' (paraphrased). I would argue that with regard to features - possibly. With regard to usability - more like glacially. I recently bought a new phone and it took me almost 1 hour to find how to set some of the features, they were so obscure. Yes, I could have read the manual, espcially the electronic version that I could search, but why should have to do that??
Most people on these boards, and most tech companies look at the value of a device as a feature list. Apple is one of the few current companies that look at the value of a device as its user experience. This is where the iPhone will shine - and win.
[Edit} Agree with THT above