I agree with you. To many, this will be a MB replacement. In the future, the iPad will further explore the capabilities with both software and hardware fully capable of meeting the requirements of computing needs for most who use it. Right now, it's probably already powerful enough for most who use a computer as an entertainment device.
In the future, it will probably type out exactly what we're thinking without the need for a keyboard; okay, so maybe we will first move through true voice recognition technologies... which brings me to something I have been thinking for a few months - why doesn't Apple have voice recognition built into this iPad? I suppose it's so v 3,1 has an added feature that everyone has to have and will upgrade for.
Software is the true limitation of all computing devices right now. We don't need Nehalem (Arrandale) CPUs. What we need is advancement of software technologies to take advantage of the C2D CPUs we already have. If any bit of hardware needs upgrading, it's that every computer needs an SSD with faster throughput. The same thing applies to the iPad; the whole point of the App Store for the iPad is to drive demand for the iPad by allowing the app developers to create a demand for the iPad. We need the iPad to run the cool apps we see our friends use or on the commercials.
Finally, I told my parents that I had planned to buy them one for Christmas, and my Ma's reply was we wouldn't know how to use it. I said, it's the easiest device in the world to use. My Pop previously said he didn't want a Tivo because he wouldn't know how to use it. Within a few minutes of seeing how it worked, he realized the user interface was far easier than the VCR he had been using for the previous 15 years. He now pushes a button to get a season pass for his favorite shows and is no longer glued to the TV and watches the shows that interest him whenever he gets around to them; before, it was always a PITA to set the VCR so he just had to be in front of the TV ensuring he didn't miss the next moment - he even admitted to getting anxiety when trying to set the VCR to record the shows he wanted to see. Software is what drives the user demand, and I suppose Apple is the greatest innovator of technology because it gets the user interface just as Tivo gets it. Users want their interaction with computers to be simpler, and the iPad is even simpler than the Mac.