On one side Google taking more control of Android and limiting third party customization is good.
On the other, IMO, Samsung and HTC have done a better job with Android's UI than Google, both HTC Sense and TouchWiz 4.0 look better and have much better functionality. Stock Android doesn't even support HD video recording, Nexus S can't do it, even though the hardware is capable of it.
Besides fragmentation, Android does not have one of the most important, fundamental features of a touchscreen phone... a hardware accelerated UI. Hopefully they'll bring it in the next update, it'd help Android A LOT!... I'm all for the good old fierce competition.