Don't be scared off. Android is really quite easy to use. My wife who is also a non techi learned how to use her phone quickly. With the exception of setting up her email, the first time, she refused to let me touch it because she wanted to learn it.
I was like wow, you added these widgets by yourself, added apps by yourself. And also re installed the Market. She absolutely loves her phone and continued to learn how to use it for productivity, such as calender, todo, etc.. and she still wont let me touch it
As for the differences of 1.6 2.2
There are quite a few enhancements mainly in UI. A lot in the Media, but I think Dell also added their own features.
The two features you'll notice is
* Word reflow HTML when you pinch zoom. No need to pan to read
* JIT engine will make apps run 10x faster.
There is more but as a user those are the bigger three.
Oh and don't worry about upgrading Android can receive the updates remotely you just have to accept it and it will be applied.
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