A couple of days playing (or should I say "research") with the v1.5 release of Google's Android on the G1 (HTC Dream) phone, nicknamed 'Cupcake', these are my initial reactions:

They have not fixed the email application.  It's still impossible to clear items from the 'trash' folder without deleting the account and recreating it.  This is a PITA and while I obviously understand Google want to push (excuse the pub) their own mail service, some of us still have POP3 accounts, and it would be handy to manage these on the phone.

A2DP Stereo Bluetooth - good, however the strength of the Bluetooth transmitter does seem weaker and I've had to re-pair with my headset twice.  No way that I can see of unremembering old Bluetooth devices either.

Visually there are improvements.  Most notably the display will automatically switch orientation without having to open the keyboard, and window animation 'slides' gracefully. Both are 'off' by default, but easily enabled by selecting:

Settings > Sound & Display > Orientation
and
Settings > Sound & Display > Animation

The Browser seems to have a nicer feel, although I can't find the settings to control compression of images now, I'm fairly sure it was there somewhere before!

A couple of old applications ceased working, like ShakeAwake - but I can live with that.

There's now a little video camera application built in, which actually seems fairly reasonable, again, I can live without this.  The stills camera seems quicker, but I cannot find the promised zoom.  Again, all fairly irrelevant to me, but nice to have on odd occasions.

The Calendar application is much nicer and easier to read due to a change to a white background and automatic orientation (see above).

The new Gallery application is pretty useless, it's easier to access pictures and video from either the video/camera or from Astro.

A few improvements to Messaging, most notably that long pressing a message gives more options - sadly it doesn't recognise GPS co-ordinates and treats them as telephone numbers.

New Live Folders are handy - I've set one to quickly list tagged contacts from the phone book favourites.

Overall, pretty good then, however...

I'm not sure if it's just me, but charging seems to take a LOT longer than before.  I haven't had a chance to conduct anything scientific yet, so this is only an initial impression.  Mark Hewitt will probably gather more of an insight into battery life improvement (or otherwise) - see http://www.silverknife.co.uk/tech/

I'm sure I'll have more thoughts and reactions over the coming days - for now though, it's a tentative thumbs-up.