I switched two family members from landline services to Ooma last year, and have been extremely pleased with the results. You buy a ~$240 Analog Terminal Adapter to connect analog phones, and never pay again for US calls. The sound quality is better than Vonage, it's certainly a lot cheaper, and if you Upgrade to their Premier service, you get 2 lines, call screening, an iPhone app that lets you make calls using your Ooma account, and some other things that weren't really worth it for us. It seems like their business model is more solid than MagicJack, without the annoyance of being tied to a PC.
My recommendation is to purchase the older Hub/Scout package as opposed to the newer models - there are fewer fees (I think all new users have to pay something like $12/year for regulatory charges), and you can use whatever devices you like. The primary downside is what to do when the device dies (which thankfully hasn't happened yet). Their customer service isn't bad, either. Had to call them about porting a number, and it took a while, but they got it right without bouncing me from person to person in India.