I'm using it for pretty much everything. I'm a Creative Director for a large consumer products company and work on everything from print collateral and packaging to web design.
I don't think I'd be happy having any laptop as my one and only computer to work on, but I seem to be relying on a desktop less and less.
The fact is there isn't much that I can't do on the MBA. I've done quite a few projects in my time working solely on a G3 PowerBook (Pismo) and for the past couple of years on a MacBook Pro.
I've got CS3 Design Premium, VMware Fusion, Extensis Suitcase, iLife and iWork. I've got about 14GB in my iTunes Library and still have about 45GB left on the HD.
I'm still deciding whether to install MS Office. I might just run the XP version under VMware Fusion off my iPod when I need it
aren't Mac's incredible?