iPhone 4 isn't fatally flawed
Yes, the antenna thing IS a huge cock-up. It's an embarrassment and there's no excuse for it.
But it's not like the phone is rendered worthless. Put a case on it and it becomes significantly better than the 3GS in all aspects except looks.
If you're in the market for an iPhone, buying the iPhone 4, even with its flawed antenna, is a no-brainer. It only costs $129 more than the 3GS (including the price of a bumper case) and it gets better reception, better battery life, better performance, better camera, MUCH better screen, gyroscope, noise canceling headphone, front-facing camera, LED flash, etc.
For $129 extra and an admitted sacrifice in the looks department, you'd be an idiot NOT to buy the iPhone 4.