I bought a 16gb wifi only ipad whilst on business recently. Have a family of five and thought someone may find it useful but not me, I like gadgets, have a powerful PC I'm happy with, not really a mac fan.
It sat at home for a week pretty much untouched and then it got popular.
My wife uses it for family photos and such like, my two year old loves it for spelling/counting games, I travel a lot and have found it great for videos etc on long plane trips, my teenage son uses it for games on car journeys and train trips.
I know laptops and other devices can do all these things and better but thats not really the point of the ipad as far as I can see. The point is it does all these things easily, no booting up, no switching user accounts, no hassles, just pick it up and use it. Try getting your two year old to fire up your PC etc.
I'm now using it for ebooks and have retired my sony reader.
For me the ipad is more than the sum of its parts. Sure - compared to the competition it may look underpowered etc but its got somrthing special.