In short, yes. No other phone does anything near what the iPhone 4 does (which is why they sold 1.7 million of them in the first three days). I don't want a different phone, I want an iPhone 4 that works.
But, apparently, such a phone that meets your standards of "works" does not exist. Wait or move on. 4.0, 3.0 2.0 software was buggy. It required a .01 or .02 before things smoothed out.
Look at every OS release or new hardware release that's come from Sony, Microsoft, etc. They had a flaw in them and it took a software release or (in the worst cases) a new hardware release to address the unforeseen issues in mass-production.
THIS IS THE RISK OF BEING AN EARLY ADOPTER.
If by "under certain circumstances," you mean "holding the phone," then yes... that is the case. Again, I don't think there would be much of an issue if Apple acknowledged the problem and conveyed that they were striving to find a fix. Instead, we have Steve Jobs saying "there is no reception issue" (blatant lie) and "hold it a different way" (basically a ***** you, deal with it). Neither of those things are going to "remedy the issue."
"Under certain circumstances" still applies. When holding a phone that causes the two antennas to bridge by flesh is in essence "a certain way".
There are other ways to hold the phone that do NOT hinder reception to the degree of bridging antennas. This quasi-fact has been established and by having irritated iPhone users generalizing the issue at hand (sorry no pun intended), they create their own lie; thus being "there is NO WAY to hold the phone without losing reception" is mass-hysterical lie.
I WILL, however, side with you on Jobs' response to it being a non-issue (the SPECIFIC act of holding the phone a CERTAIN way), it is obviously an issue of some sorts. The temporary fix at this time is to have the phone held at any other angle other than the ONE area that hinders reception.
Again, I will side with you that if they did acknowledge that bridging the phone's antenna in this manner would result in dropped calls and no service then the public would have been better informed to make a decision as to whether their hand placement habits would inhibit their enjoyment of an iPhone purchase.
If this really is a software problem (highly unlikely), and could be fixed simply by a firmware update, then I concede that there really is nothing to worry about. Again, however, Apple has conveyed that they're not really interested in finding a solution and that they're basically blowing off the issue.
I would also concede that there is nothing to worry about if Apple could produce a fix that would allow the antenna to better calculate a better way to handle the attenuation or at least be less sensitive to it. This would allow them to deal with a hardware issue in a software manner.
Although Apple and Steve Jobs are typically used interchangeably on these and other forums, I don't believe that an engineer who may be responsible for a fix would have stated the same brief statement that Steve issued. I believe that Steve's choice in words were poor in his typical brevity but I believe that his message stating "stay tuned" was not a way to blow off the issue. Since this is all he gave us to look forward in the future, I can't really say more on this issue without completely guessing.
Calling people names just lessens your own credibility. I wasn't interested in the 3GS the first time around, and I'm still not interested. Low-res screen, piss poor camera... the iPhone 4 basically "fixed" everything I had an issue with in the previous model. Telling someone to buy a Taurus because the brakes on their Explorer doesn't work makes absolutely no sense.
Calling people names merely expresses how I feel about those who would rather take this route as opposed to the others that were laid out for them. I also posted with NO INTENTION of laying any amount of credibility towards my name or avatar, ESPECIALLY one about frivolous lawsuits.

This being a public forum of speech, I hope to NEVER be taken so seriously as to cause any mental anguish in those who read my posts.
As for the 3GS vs i4, the low-res screen and piss poor camera, both of which where hailed as "nice" or even moderately decent for its time, could be referred to as "issues" seems to be more of a personal disagreement with old tech verses new. This should be regarded as a comparison of whether or not the older 3GS would work best for you while waiting for i5 or, much sooner, an updated software version for the i4. Please bear in mind that it has not even been 1 week since the earliest of early deliveries reached the hands of the masses. These bugs will be worked out as the yellowing of the screens have in the past versions of iPhone and reception issues in the macbook air laptops. I guess it doesn't feel like it's only 5 days since the official release to the public with all the news flying around about it.
As for your car analogy, I feel these tend to be poorly apply 1:1 to technology such as a "mobile phones/computers" but again, the brakes on the explorer worked fine unless you did something as to press both pedals at the same time. The breaks on your Explorer and your antenna on your iPhone work fine as long as users don't do the ONE thing that is documented as to cause an issue. But please don't misunderstand, I know how you feel when you say you want to be able to hold your phone any way you want, but for the time being, until the attenuation issue (which in my opinion IS an issue) is resolved in a .0.x release
Returning the phone does nothing but leave me without a phone.
Do they not reimburse you for returning a product? Could that money not be put towards any other phone that could settle you until Apple works out all the kinks?
Again, this hysteria makes even me want to run out every evening looking for an iPhone at a brick-and-mortar place but restraint allows me to watch some of the issues that come from the early adopters who take a
genuine risk of buying a new product with a .0 software release. My condolences on your situation.
I don't believe anyone who posted in my
thread guessed antenna. In hindsight, I feel like I jinxed the whole release
