The apps are a HUGE part of what makes the iPhone magical.
But I only realized this AFTER buying my iPhone.
The same was true for me. I bought the iPhone before there were any real apps. The base functionality was great, especially the built in real web browser and proper HTML e-mail. It was only later that value was added with tons of third party apps. This is why when I did my Android experiment, I wanted the first part of it to be focused on what the core experience was. For me, it wasn't better then the core experience of the iPhone, and due to serious issues like the GPS, the phone went back before I even dug into the app market.
If I were to consider a Windows Phone 7 device, the core experience has to be solid. Once that part is proven, then the apps start making the device even more useful. It seems like Microsoft did put a lot of effort into the core, so it's something that looks promising to me.
It will be interesting to see how this shapes up. Android and Windows Phone 7 take the same approach of offering a platform on a ton of varied devices made by third parties. This mirrors the current Windows PC market today, but that market only exists in it's current form due to Microsoft's illegal actions in the 90s. With real competition this time around, I'm watching to see how this plays out. Google is going with the more open approach for OEMs and carriers to change what they want, Microsoft is being a little more controlling this time compared to their older Windows Mobile attempts.
Apple, RIM, and HP (Palm) are on the other side, providing the platform and the hardware as one single piece. So far, this approach has worked well for both Apple and RIM, and may work for PalmOS now that they have a large company to help push forward the marketing message.
Not only do consumers have choice in the mobile space, they have choices even inside the different strategies.