I too have been reading the reviews, and after thinking about them I eventually concluded that this tablet doesn't do anything I want. It falls into a product niche that has both too much and not enough hardware to suit me. I know that makes little sense, so let me explain.
As I see it, there are 3 types of Android tablet on the market: budget, premium, and basic.
The Nexus 7 is what I am calling a basic tablet. Like the Kindle Fire (which I think defined the product niche), the Nexus 7 rises above the sub-$100 budget tablets thanks to a multi-core CPU, good screen, and generally decent hardware. It in fact sets a new standard for a basic tablet (as opposed to bargain and premium) but it merely joins the niche, it doesn't redefine it.
BTW, another tablet in the basic niche is the Samsung Galaxy Tab 2 7.0. The Tab 2 came out a few months back with a price of $250 and a general goal of competing with the Kindle Fire. It's not a terribly good tablet but at the time it was good enough to compete with the Kindle Fire.
The thing is, I don't want or need a basic tablet. I want a budget or a premium tablet; the ones in between don't have the features I need.
In particular, the Nexus 7 is missing the second camera on the back. I used a similar camera on my Samsung Galaxy Tab to take photos while on the show floor at CES 2012, and what ever tablet I got to replace the Galaxy tab would also need a camera.
Without that second camera the Nexus 7 isn't any more useful to me than the Kindle Fire, and I already have one of those.
And yes, I don't really see a need to upgrade from the Kindle Fire. The extra CPU cores, camera, and Google Play don't interest me all that much at the moment. Okay, the Nexus 7 is indeed droolworthy, but it's not worth it for me to put down $200.
And I'm not alone. This morning I got an offer to take a Nexus 7 off someone's hands. He decided he'd much rather save the funds for other gadget purchases. It's a nice tablet, but it doesn't quite live up to the hype.
P.S. I might end up buying a Nexus 7, but at this point I'm waiting to see what the Kindle Fire 2 looks like. Chances are it will be another $200 tablet with specs better than the Nexus 7.