In the UK and queued for 2 hours to get an iPhone, completely love it, best gadget I have ever owned. Best email and internet ever on a hand held.
I know that email is much better than MMS and cheaper but would still use it if it was on the iphone. If I get a text I read it there and then, same for a MMS, if I get an email I wait till I have time to check my email. It's a much more instant form of communication for mobile devices than email. People send MMSs mostly for amusement, not because they expect the pictures to be printed out and gazed at in wonder, so the lack of pixels isn't a problem.
I also don't understand the email is better, so why have it then. If that was the case why would we have SMS, email is much better? I think we should have both because most people don't have an iPhone, and it is going to take years for SE, Motorola and Nokia to catch up with the iphone so the non iphone (and blackberry) world is not going to read an email when they are away from their computer. Most people I know have MMS capable phones, don't know anyone else with an iPhone yet, so O2 are missing out on any revenue they would have got from me from sending MMSs.
The other iPhone fan's argument that you get is that you can just email their mobile number, i.e. +447123456789@o2.co.uk or something, but while I have sent MMS to email easily enough I have never got it to work the other way.
Lack of MMS is just another one of these things you have to put up with (no multiple recipients for text, nor forwarding texts, no video camera, no saving pictures to your photos etc. etc...) for owning an iphone . Like not having a big boot and rear seats on a sports car, but you live with it because it goes round corners fast and looks great. And obviously I am willing to live without them because I did buy the phone, but it is a glaring ommission and if we are being honest I am sure most people were surprised when they first heard the iPhone didn't have it.
Obviously not having it is not the worst thing in the world, but I'd still rather have it.