I've used my HTC Hero a lot for internet/iplayer/gps/podcasting but I don't make that many x-network calls (probably around 90 mins/month) so this package is ideal for me. It's a £10/month contract with a phone cost of £115. This includes 100 cross network minutes, 100 texts, unlimited landline calls (other free booster options were available) and "unlimited" data. I went through topcashback and have £80 tracking.
Battery life is very good for a smartphone, the screen is the same size as the Desire but slightly higher resolution. Best of all the front is Gorilla Glass and the body is waterproof (1m). It's currently running Android 2.1 but is expected to get 2.2 early next year. Swype is preloaded. It seems faster than a Galaxy S but not as fast as the newer 1Ghz phones. Motoblur gets a bit of a bashing in reviews but I use Launcherpro so it's not an issue.
Review here - http://www.engadget.com/2010/11/18/motorola-defy-review/
And a video with some dropping, scratching and soaking here - http://www.tracyandmatt.co.uk/forums/viewtopic.php?f=12&t=8635
Without a contract the phone is around £299.