I have a G1 as my only digital camera, which I carry with me nearly always. I had a D70 before, which I never liked—in fact, I have just never liked any autofocus SLR, and APS-C DSLRs I liked worse because of the small viewfinders.
As for lenses, I've got the 14-45mm, 45-200mm, 20mm and 7-14mm; the ones I like best and always carry with me are the 20 and the 7-14.
People are always complaining about the high ISO performance of these cameras; a common claim is that my G1, for example, is unusable above ISO 800 or ISO 1000 (depending on the person making the claim). I disagree. While the photos do noticeably suffer, I routinely get keepers at ISO 1600. I do process RAW in Lightroom 3 and take care to keep the noise under control by a combination of (a) choosing relatively high black points to keep the noisy areas dark, and (b) applying noise reduction lightly.
What does bother me about the G1, performance wise, is highlight range for shooting in clear sunshine days (which is most of the year here in California).
Here's an example ISO 1600 shot (with the 20/1.7; focus was a bit off). Yeah, it's clearly noisy, but come on, it's very far from disastrous:
http://www.flickr.com/photos/26665183@N00/5230261181/
For comparison, here's an ISO 1000 shot from the same night:
http://www.flickr.com/photos/26665183@N00/5230861050/