I've been using Vista for a while now, and here's my verdict:
Do not, under any circumstance, use it on an older machine. There's just too many problems. Put it on when you build a new machine, or buy a machine that already has it installed.
To be honest, I don't like running it on anything less than a Core 2.
And oh, yeah - don't use it with less than 2 GB of memory, unless you love waiting for Windows to swap everything in/out of memory all the time.
Quite frankly, it's not even worth bothering with until SP1 (except for development purposes), which has many improvements including a roll up of all of the bug fixes - and there are a lot of bug fixes.
BUT: It's not that bad of an OS when you've got all of the incompatibilities out of the way. I've yet to have any troubles with games made for Windows XP. Even with 64 bit Vista (which I'm running right now), everything works once all of the drivers are up to date. Just remember to keep on top of graphics driver updates, because they've been coming pretty frequently.
As a developer, though: You need to have at least one development machine running Vista.
Because, even though the OS looks the same to the user, it's totally alien to the developer. The user files are all in a different folder. Programs that access admin stuff need to be compatible with UAC. Both the sound and graphics systems have been totally rewritten. "Program Files" is now read only and user stuff is expected to be in the user's own folders, and the list goes on. Despite the similarities to XP from the user's perspective, Vista is totally different under the hood.