Yeah. Which for a device designed specifically for online activity is beyond crazy. It essentially means you can't run a browser, music player and instant messenger at the same time. Windows could do that 15 years ago - there's really no excuse.
It's a popular misconception that you can't multitask on the iPhone OS.
You can browse and listen to music in the background. You can actually do most things while listening to music in the background. Infact most of the defaul applications (Safari, SMS, iPod) allow multitasking as you can switch between them via the homescreen seamlessly without losing anything and allowing them to complete their tasks. Which ultimately is multitasking.
What you can't do is run more then one of the market place apps simultaneously. However, they can run in the background with limited functionality, with user interaction through alerts. Which again is multitasking.
Despite this implimentation often being cited as a negative of the OS, I think it actually depends on your perspective and requirements.
Having used an iPhone for 2 years, WM previously and Android (2.1 on Nexus 1) now, I can definately see the advantages of the Apple implimentation. On a device with limited battery capacity, processor, memory and input mechanisms, such tight control over running processes is often a positive. Do I want to be concerned with ensuring there aren't erroneous apps/process running in the background on my phone when I'm away from a charger all day? IMO the answer is no.
I could run my iPhone for weeks with consistant performance and battery life. And thats with daily installation of Apps. I am yet to find another smartphone that I can do that with. Even the N1 slows down and requires a reboot sometimes. Battery drain is also inconsistant sometimes (sometimes task killer solves this, sometimes its the cause of the problem, so a reboot is usually the best way to rectify it).
There's a whole segment of the market who either can't, or don't want to deal with such issues. They are often derided for simply stating "the iPhone just works" or "its easy to use". As an embedded and software designer I can tell you, achieving that is easier said then done. And its only because of that achievement that people like my girlfriend have been tempted into the smartphone market.
I think much of these positives carry over to the iPad. If its a secondary device to watch video's, surf, look at pictures, read, do I want windows running on it? Given the size of the screen and restrictive input method I would say probably not. I would say I probably value simplicity, ease of use, cost and battery power over full fledged OS.
Having switched to the N1 I can honestly only think of 1 instance where I value multitasking, and thats running IM. Even then it wasn't a major issue with background alerts as I don't use IM the same way on the move as I do at home. The biggest plus for me is the higher res screen. Even the processor comes a distant second.
I would probably buy the iPad as a secondary surfing device at home. But this brings me to its majpr downfall IMO, the lack of flash. Apple need to settle their spat with Adobe, because while they can get away with it on a mobile, they certainly can't with the iPad. In terms of multitasking, apps, the only one would be always on IM client.