I've been playing with it and so far I'm impressed. You still have to learn the individual iPhone API calls and adjust to the new environment but once you get past that it's actually quite easy to use.
I've heard very positive things. I haven't used it personally, but my boss had been doing some playing with it. Main barrier for me is the price tag if I find I like it.
The evaluation version is fully functional in the simulator, but you can't get it onto a real device. $399 for the cheapest version. If they halved the price I'd buy it, I'm sure many more would too.
I don't suppose anyone's still following this, but I borrowed a mac, and installed monotouch. It's very impressive indeed. $400 is easy to justify at work, but for free stuff at home not so much.