Let me explain a few things.
First off, I have a Touch and love it. No question. It's awesome. HOWEVER, there are some things about it that I had HOPED for ages would have been addressed, such as a lack of multitasking. ditto for Flash. Those two issues notwithstanding, BEFORE the iPad came out, I had hopes that whatever tablet Apple created, it would be far more than JUST a "large touch". Right off the bat, a large touch isn't as useful for me because I can't/won't carry it around town with me, because it won't fit in my pocket or clip on my waistband. At home, I have all sorts of web enabled devices. Nine, to be precise. There's simply no need for a "large touch", given all the devices I've got already. Having said that, I might have been persuaded to part with some cash if an "insanely great, magical" device had included Flash, multitasking, HDMI, HD output, AMOLED, memory slot, etc, etc. Then I wouldn't feel like I would be buying a crippled device. The iPad doesn't really advance the technology much, IMO. IT'S JUST A LARGER, HEAVIER TOUCH, BASICALLY. And that's not what I need/want.
I sure as heck don't want to hold a 1.6 lb device in my hands for reading books at night. I have a perfectly good touch (under 4 ounces) to do that.