It really is a big iPod touch with a bigger screen and faster processor. From a hardware/OS standpoint, that's exactly what it is. I think that's a pretty big deal though. Its not "just" that. The bigger screen and faster processor makes all kinds of new software possible that could never be done on an iPod touch. It makes the same software that was available on the iPod touch far more useful and usable. I think if you look at what people are doing with the iPad vs what people are doing with the iPod touch you will see a huge difference. IPad users are doing a lot more web surfing and email. A lot less audio playing, and using a whole lot more productivity apps.
So, the hardware and OS may be "just" an iPod touch with a big screen and faster processor, but people are using them in completely different ways.