It is far better than a netbook. What does a netbook do? Browse the web using a cramped keyboard, extremely underpowered, not good for much more than browsing the web.
The iPad is far more. It has an incredible looking iWork app for $10, you can browse photos and videos in an unbelievable fashion, the browser is a joy to use, you can download over 140 000 apps on the app store, now get books on it. Youtube, HD video on a 10" display. And its $499!
Day one purchase for me.
It is no better than a netbook. It fits a different niche. It's more of a multimedia device rather than a practical everyday device. My netbook has four times the storage, a faster processor, undoubtedly more RAM (doubt the iPad has 2GB), wireless N networking, an SD card slot, 3 USBs, a battery that actually gets 8-12 hours (8 hours being very heavy usage), and a keyboard that is undoubtedly easier to type on. Not to mention a webcam. My netbook with the RAM upgrade was only $450.
Sure an IPS display will look better, but I've got 10.1" 16:9 display, and it runs an actual PC OS. If I want Snow Leopard? Sure, no problem.