I have an iPhone, and my sweetie has a BlackJack with AT&T. We both agree her BlackJack is a POS for surfing the net compared to the iPhone, and overall ergonomics, useability, and finctionality on the iPhone is just head and shoulders above anything else on the market. It's my opinion that the iPhone is the Martin Logan of the cell phone world...
I've heard of a lot of people having trouble with their iPhones 3G's, but I've had mine since they came out and haven't had a single problem with it. The first pair of headphones DID crap out after about 2 months, but the AT&T store ws REALLY cool and gave me a new pair.
I've got about a dozen apps on my phone (but no games) and I play a lot of music and podcasts through it too, and it works brilliantly.
If you have access to a 3g or WiFi network, the iPhone is surprisingly fast for surfing the net or reading email. It even downloads usic and apps quickly if you use these high-speed network connections. But I'll admit, on a standard "EDGE" network, downloads and internet access can be a little on the sluggish side...
If you want a phone that looks cool, is built well, and had a TON of super-cool, customizable functionality, then the iPhone is really the only game in town, IMO. Every other "smart phone" is just a pale imitator, a wannabe, a pretender...