I got my Neo as an upgrade to my beloved Desire a couple of weeks ago.
I was holding off for something that addressed the three major weaknesses of the Desire, which were (IMO): crap camera, crap sound and screen that couldn't be seen in daylight.
The Neo has addressed all these perfectly, and added a front camera.
Now it's rooted with Gingerbreak I've overcome the low memory issues, too.
The camera is very good. Only beaten (on Android phones) by the upcoming Samsung Galaxy S II which looks exceptional, but that's double the Neo's price. Neo pics are over-saturated, and need the colour saturation backing off 20 notches in your favourite graphics package (not Picasa) before you compare them with other pics, or they look silly.
They're over-compressed, which may be fixable now I'm rooted. Just have to find where the camera settings are stored...
The sound from the speaker is fantastic. It's a revelation after the Desire, with some actual bass being produced. Importantly, it's also way better than the Xperia Arc, and it's the reason I want for the Neo over the Arc after trying them both out.
My only criticisms are to do with the screen: It's the same size diagonally, and slightly higher res, but it's thinner and taller than the Desire's screen, which is a format I've never liked. It makes the keyboard even harder to use as there's less room for the keys.
Also, the screen has a green tint to it. This may just be my device, but I doubt it. It's very noticeable next to the Desire's warm OLED screen.
The Neo screen does have a beauty of its own, though - very black and glossy and hi-tech looking.
So, if your Desire's coming up for an upgrade, I reckon Neo is 'the one'
It's not supposed to be out in the UK (where I am) until June, but I got mine for £350 off a Chinese eBay seller with no problems. 5 days for delivery. I won't say the name, but look very carefully at the feedback and choose accordingly.
Oh, one more thing - HARDWARE BUTTONS!