As judged by anecdotes, as well as by going through the various demo videos (yes, this means I haven’t held one in my hand, so my knowledge is limited):

Things I’m jealous of:

• Much nicer e-mail client. It’s (obviously) Gmail-specific, but it comes with so much functionality I sorely miss on the terribly limited iPhone OS’s Mail.
• Better spelling suggestions/correction. Multiple choices presented in a horizontal band as you type.
• Speed and specs. The UI looks much smoother than iPhone OS 3.1 does on my (admittedly now-aging) iPhone 3G. In large part, I’m sure, due to four times the RAM (512 MB vs. 128), and a much faster CPU (the Cortex A8-like, ARMv7-based Snapdragon at 1 GHz, rather than Apple’s custom ARMv6-based chip at 412 MHz). Speaking of specs, a honorary mention goes to the far higher resolution — 854×480 vs. 480×320, which should provide benefits in the long run.
• Background applications. This is one area where I’m curious to see what direction Apple is heading in.
• Notifications. Not shown much in the demos, but supposedly decent. iPhone OS handles them absolutely terribly. One alert on top of another and you’ve got yourself a user-hostile mess.

Things I’m not so jealous of:

• Inferior browser in-page navigation. It’s not just that Android’s default-shipping browser lacks multi-touch zoom; it’s much more importantly that, as the demo video illustrates so nicely¹, double-tap-to-zoom picks a seemingly random area (in this particular case, a portion of the picture) to zoom in on, quite unlike Safari on iPhone OS, which would have shown the entire picture, left to right. Pictures is one thing, paragraphs is another; it appears Safari is much smart about figuring out what you want to focus on.² This may seem like a minor point, but is in fact a huge win in user experience for iPhone OS.
• Ugly text rendering. The fonts look like Linux. Oh, right. Googl eneeds to invest some R&D money here.
• Inconsistent UI. In the demo videos, this is most noticeable with toolbars — or, more generally speaking, the layout of controls within the apps: each of the shown apps appears to have its own idea of where to place the buttons, and what size, shading, background color, etc. they ought to be. It’s far from bad, but it’s hardly good either. iPhone OS, despite having multiple variants of control styles, gives a clear impression of existing overall design guidelines.

Android has been developing at a rapid pace, which puts some wonderful pressure on Apple to hopefully make a nice leap with iPhone OS 4 and beyond, but it’s nowhere near the point where I’d even consider switching.

1. How could someone produce such a video and not notice how little sense this behavior makes? ↩
2. This works so well, in fact, that I miss that functionality on any desktop browser. ↩