It depends on how picky you are. For many people, the Asus would be just fine.
However, I am going to argue that the core features of what makes a laptop enjoyable (even if you don't know it at present) are:
screen quality
keyboard quality
touchpad quality
battery life
In this regard, the macbook air handily trounces the asus. This is why it's $1000 for seemingly less features. Regarding the screen, there are no screens being produced except in Sony laptops that are as nice as the ones in the macbook air. I am perplexed as to why more people don't care about this. Asus, Lenovo, and Dell all use cheap screens in their ultraportables. I suppose the difference would not be a problem for someone who's never laid eyes on a "good" screen, but once you have, the difference should be apparent even in isolation. The macbook air would make an excellent video player.
The Asus keyboard allegedly has some flex to it, but I will defer to the reviews. The air has none. The touchpad on a mac is still second to none. The responsiveness and the sheer size of it will, over the course of all-day usage, make your fingers feel less tired. Sounds kinda stupid, but the ergonomics are significantly different and this will not be apparent immediately. But use your mac, and then go back to any other laptop and you should see what I'm talking about. The only exception would be a thinkpad, as I think that their touchpad/trackpoint combo is very good as well.
The battery life should not be dismissed, as for some 5 hours is just not going to be enough (for the macbook air). But a more fair comparison would be to be minutes/ pound. The air was designed to be thin and light, period. I believe that the air, given a 63 watt-hour battery like the Asus, would be pulling at least 10 hours as well. But then it would be a 3 pound machine. Personally, I would gladly take an air that was 3 lbs and 11.6" if it had such long battery life.
In summary, if you care about the core features of computing--typing, looking at a screen, and navigating with a touchpad--then the macbook air is your choice, without debate. I don't see how anyone could sanely argue these points.
If sheer # of features for your buck (ports, connectivity, hard drive space, ram) are important, then you would do better with the Asus.
Apple focuses on the user experience at the expense of everything else. That they sell alot of products whose feature sets are often dramatically less than the competition (for a higher price, too!) shows that when you use their products, it's enjoyable and that's what sells. The iphone has way less features than android, but it's still holding its own. Same with the macbook air, I suspect. The early reviews are overwhelmingly positive, and it's sort of like the ipad. So many people thought that the device would be a tweener, with no clear use case, but the sales numbers do not lie. I still don't know how useful the ipad is, but it is definitely a fun experience. The macbook air I would be shocked if it did not become the dominant ultraportable by version 2 next year when they tack on another 2 hours of battery life + add back the backlit keyboard.