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I haven't actually gotten to use either of those, however I have seen some videos of the Asus Transformer in action. I like the Asus, it seems nice. However, I would still pick the iPad over the Asus. I can't be too confident about that statement because I haven't actually had the chance to use it myself, I am basing my opinion on videos that I have seen.

You could say the same thing about a phone now. Your phone is a clock, an alarm clock, in many cases it functions as a wallet, it's your device for buying goods online, it's a music player, a video player, a gaming tool, it's function eliminates a lot of different individual products much like the tablet will do one day. Yet we have safe guards in place to protect ourselves: we have insurance plans on mobile phones to lessen the financial costs, we have cases designed to protect them from damage etc etc. When something has multiple functions and leaves a void if it is stolen/damaged, it's up to us to develop contingency plans to recover from disaster as opposed to simply not using the device at all.

As far as the "which tablet will dominate" argument goes, the iPad will have a long time market dominance not because it's the better device, but simply because it's got the branding and the marketing behind it. Apple devices may be inferior in some cases, but everyone buys them. They look nice, they are "cool" and they are marketed like no tomorrow. When I heard people referring to MP3 players as iPods, I knew the war was lost.