I've really considering getting an iPad for fun/entertainment as well as music, but is it worth using for business/productivity as well?
Yes, it is worth using for business/productivity.
I use it to review and markup PDFs of agreements, term sheets, etc. (GoodReader)
I use it for writing documents. Generally I write text with the onscreen keyboard with one of the simple writing apps (I use Nebulous). I do formatting and drag tables and illustrations around using Apple's Pages App.
I do invoicing, quotes, and expenses in Apple's Numbers App.
I use the WordPress App to update company blogs and websites for my products.
I store most of my documents in either iCloud or DropBox so they are always up-to-date on my Mac as well as my iPad.
Evernote is also an App I use a lot for work.
I organize notes, research, project plans and other documents using MediaWiki. (I used it so much, I wrote an App for MediaWiki, it's an awesome Wiki platform.)
I do cloud software, so I connect to my company's cloud using F5's Edge Client VPN/Security and work directly on my Linux (iSSH for ssh and vnc) and Windows (VMware View / Wyse Pocket Cloud). I can also manage servers on RackSpace / OpenStack through the Rackspace App.
When I travel, I leave my MacBook behind and just bring a Wifi Keyboard and my iPad 2. I have the Incase "Origami" case that protects the keyboard and folds into a stand for the iPad. It really works great. I live in Hawaii, so I end up taking a lot of long flights. I've never had a problem with working a full 10-12 hour day with the iPad's battery.
So, I'm not sure what kind of work you do, but for me at least, the iPad really has become a work-horse machine. My MacBook hardly gets used now. My 27" iMac has a great screen, and I love it for coding -- but I end up using the iPad for almost everything else: Facebook, LinkedIn, Twitter, Youtube, Reading News (I use Zite) and so on.
It's just extremely comfortable to walk around, or sit down anywhere and get things done.