I use mine as a PDA all the time. I've got all my contacts, appointments and notes on it, as well as my pics, music and movies. Pretty much all you need as far as I'm concerned. It also syncs seamlessly with your computer, which makes backup very nice.
When I'm travelling, it provides me with entertainment for hours on end. In the morning, I'll download a few pages from the local newspaper off the internet, and read them on the bus on the way to work.
Don't forget, with the new SDK apps coming out in June, it's just going to get even better!! I love the feel and look of the touch. It fits nicely into my pocket, and half the time I don't even notice it's there. The screen is great and the apps are simple and fun to use.
IMHO, you don't need to jailbreak it to make it an effective PDA, but some people do anyway.
If you get one, have fun!!