It is disappointing, the way they handled this. But that is not a reflection on the phone, just on their marketing. Their skinned 1.6 seems to be pretty good, the only thing I would be missing is Flash. I am sure they will be delivering on 2.2 though, they have the 7" and 10" tablets coming up. People will be watching.
I am in no hurry, and unfortunately I don't see any other 5" phone coming up. That Motorola Droid X does look interesting (though they have no GSM version yet). However, the way Motorola is locking things down I won't be buying it. So -- where are the alternatives?