The G2 has better AF, the MF is simpler (but MF on the G's is pretty useless to me), and the layout is much better for this user. I had the G1, but sold it. Came back for the lenses, and the G2 works for me.
The focus wheel on the G1 was in a bad place for me- I often knocked the thing into MF mode without intending to. You'll hear that this is impossible, but it happened to me often.
Layout of controls on the G2 is pretty near perfect.