If you'd ever used an iPhone or iPod touch, you would know that the iPod app keeps playing in the background when you switch away. So yes, you CAN browse the web while listening to music. Unless you meant "you can't browse the web while streaming Pandora", which is true. But that's not what you said. :)
So unless Apple has broken this functionality without stating that they have, your first complaint is completely invalid. The screen is higher resolution than DVD, and DVD-quality video is clearly the most popular option in the US right now, so the screen is capable of showing better-than-DVD-quality video... so, no, it's not 720p, or 1080p, but it's still going to look pretty damn good.
Of the issues you raised, the only really valid one is that you can't use a USB thumb drive with it, but that's hardly a dealbreaker.
That said, Slashdot approval has been pretty much inversely related to Apple product success in the past, so it looks like the iPad will do extremely well based on the comments here...