Ok, lots to go over here:
1) There are tons of 'file' apps that let you put whatever you want on an iPad. PDFs, Word docs, Excel files, MP3s. Whatever.
You can open and view some, but not all (it delends on the app you got), But you can certainly use your iPad as a USB drive.
And I did mean "as a USB drive." No, you can't hook a flash drive up TO an iPad. (That converter thing only does cameras.) You can either plug the iPad into your computer using USB or you use Dropbox and copy over the Internet. (Both to the Dropbox app or another that supports it.)
I use Dropbox 90% of the time and I use the USB cord when I have really large files.
2) Not having a file system doesn't mean you can't use files.
When I'm traveling I capture RAW photos from my camera to my iPad using the basic photo app. Then I open them in Photogen and edit them. Then I use a 3rd party Flickr app to upload them there or I put them on Dropbox if I only want 1 person to download them.
Point is, I'm moving these photos all over my iPad doing whatever I want to do with them. Anyone who says they can't live without a file system hasn't actually tried it, I think.
3) There are some apps that play alternate movie files, I think, but I'm not sure because they're battery-killers which is why Apple isn't natively supporting the codecs in the first place. I prefer to convert my video and not deal with that.
4) Anyone recommending the Playbook needs to point out that it only does e-mail THROUGH a Blackberry phone. If you have one, great. If you don't, not so great.
5) I believe that this will be the first real iPad competitor:
http://techcrunch.com/2011/09/02/amazon-kindle-tablet/
I didn't say it was impossible, just that I hadn't seen one yet. Now I think I have.