Since everyone here either misinformed you or was just plain wrong about the G1, let me prop it up a little.
Yes, it's a little big and it's not sleek and sexy like the others. I just dumped a Blackberry Pearl for the G1, and that was a pretty sleek phone, if you want to force yourself to use Outlook or some other Windows crap software to sync you phone.
Here's what the G1 has: total integration with Google. You need a Google account to set the phone up (you can set one up on the phone when you start it for the first time, but you aren't FORCED to use the Google apps). But if you have an account, your mail, contacts and calendar are all synced with your on-line account...no need to buy expensive software or be married to Windows.
The Internet access includes browsing with the Chrome browser (and the Opera mini browser was just released for the G1). The browser is fast and the resolution is fantastic.
The G1 uses the T-Mobile 3G network (rolling out acroos the nation, now in most major cities), along with Edge and GSM. The phone also has Wi-Fi capability and the T-Mobile data plan includes free use of T-Mobile Hot Spots all over the world (there's an app to find them, too).
The phone is fully touch, the screen image flips to wide mode when you open the keyboard, the keyboard is full QWERTY (much easier than my old multi-keypress Blackberry Pearl), has a 3mp camera with autofocus, media player (plays ogg files, too), Bluetooth, MicroSDHC media card slot (works with up to 16GB cards).
I've used the phone in both 3G and Edge networks, and it's very speedy on both.
One responder mentioned all the apps the iPhone has. Admittedly, this is true, but the iPhone has been on the street for 17 months. The G1 was released in October. The development world is spinning up rapidly, and I'm betting that the Android Market will be chock full of great apps in no time.
That's the other thing that attracted me to the G1. Google developed the Android system for open source development. Anyone can create an app and make it available through the Android Market, unlike Apple, which restricts applications and requires approval before making something available on the store. The Android system uses a Linux kernel at its core, which means the system can be embedded in a variety of devices. If you like to hack with your tech, this is a perfect phone for doing that.
I've had mine for a week or so, and I'm loving it more each day. Give it some consideration.