I have had zero problems of any significant nature. In pictures, it looks kinda cheaply made somehow, but that's definitely not the case. It's got a nice heft to it, and I carry it in my (front jeans) pocket all the time. That said, if I have something else in that pocket, I use the little neoprene-like pouch that it comes with. (I don't really like the brown and champagne color scheme, though.)

The only real issue with it that I have is that if you install a lot of applications, the interface can slow down, and sometimes the Launcher (that is, the GUI shell) will crash. Not a problem for you, at least initially, as you don't have anything you're dying to download.

The browser works quite well, and phone calls and SMS seem to work just fine. I don't have enough experience with an iPhone (or any other recent vintage smartphone) to make a great comparison from that front, though. And, honestly, I don't really talk on the phone all that much.

I paid full price for mine (and swapped in a SIM card for a contract I already had) and I am not disappointed in the least. I have experienced both buyer's remorse and post-purchase rationalization/selection bias in the past, and I feel neither of these about the Nexus One.