I've has my Galaxy Tab 10.1 for a couple of months. Before that I had a Nook Color that I rooted. I started with the NC because I wasn't sure if I would have a use for a tablet, and the NC was half the price of the Tab.
There's no doubt these are primarily consumption devices; although they can be used for creation, that's not their strength and the more creative work you do on them the less fun it gets. What surprised me was just how much of my ordinary computer use was consumptive, and that now it's easier to squeeze in a bit of consumption here and there without resorting to a full computer. Instant on, super-long battery life, and an OS that's simplified make a huge difference.
As much as I was surprised how much I now do on my Tab (so much so that my regular computer gets dusty), imagine what it's like for people that really do want a computer "appliance". Apple created an entire market of consumers out of people who previously weren't consumers: people who didn't want the hassle of [another] computer. This is part of the magic of the iPad, and why nearly 30 million have been sold. The TouchPad's demise doesn't tell us much about the tablet market overall except that the TouchPad wasn't what people wanted compared to an iPad. Android has similar market-share (and mind-share) problems, only differing in degree.
Google should be throwing money at devs to write Android tablet apps if they want to catch up to Apple, our even just stay in the game. Otherwise they risk being marginalized, and if that happens on the tablet side it may leak over to the phone side.