Really? I started using it almost on day one and feel like I had an unqualified positive experience. In particular, this was the first platform I used that freed me from the burdens is sys admin. (Obviously that is not unique to gae. Also, there are numerous other qualities I enjoy.)

What do you find lacking?

It depends what you use it for. For relatively small apps that don't need much system level tuning I find it pretty awesome. Scaling wise it's fantastic - I have an app serving >100k hits/day (admittedly doing very little for each hit) with no problem.