After seeing the Apple presentation as well as seeing some of the follow up comments, here are some of my thoughts:
It is a cool looking device and I think there is a place for something between the iTouch and a Laptop. Or said another way, something that's easier on the eyes than the iTouch and more relaxing than a laptop.
That said, the device that sits 'between' the iTouch and a laptop, needs to 'bridge the gap.' That's where I think the first version of the iPad fails. Keep in mind, lots of people will buy it so fails means, 'fails for me' in terms of my expectations.
For all practical purposes, the iPad is a very large iTouch. And, it has the same technical limitations as the iTouch (no camera, no video camera, no Flash video support, no multitasking) and the large screen size doesn't make these gaps disappear.
In fairness to the iPad, it doesn't have a camera / video camera because 1) its too big for a camera (imagine taking a family pic with a 10" x 10" device!) and 2) the video camera (for conferencing / chatting) would be, by design, pointing at the ceiling because the iPad is flat. I think these were excluded as part of the overall design / relaxed sofa surfing experience it was designed for. Fair Enough.
No Flash means you can only stream video from YouTube (no Hulu, no flash web sites, etc) OR watch videos purchased from iTunes. I don't think I need to paint a picture here, it's pretty clear what Flash support isn't built in!
In terms of the lack of multitasking, if you have an iPhone or iPad, you're use to this by now. Not that big of an issue with these smaller devices and my understanding is that was done to preserve battery life, which is reasonable enough. This, however, is a totally different deal in terms of how I believe people people use the iPad.
Like with a laptop, I believe people fundamentally will want to multitask applications (e.g edit photos while listing to music, sending an email or chatting with friends). None of this is possible with the iPad and I think that is a huge mistake. So, why did they do they do this? My opinion is that more open apps hitting the processor slows everything down which causes more instability, reduced battery life, and makes 'less happy' customers. Keep in mind that a big part of the Apple experience is stability.
I think Apple is a smart company and what people like about the iPad might be the iBook Store / Reader, News, access to traditional media (newspapers/magazines), and/or simply surfing the net for information. The reason I say this is because ultimately the iTouch's success was driven by something that Apple didn't realize ... personal gaming, not music, video or multitasking applications. If the iPad simply becomes an eReader w/ extras, there is a big market for this!
All this said, I don't mean that Apple won't sell a lot of iPads, I think they will. But these are some of the things Apple will ultimately have to address to get people to make the iPad their 'go to' device.