Well I'll be getting a cheap Android tablet eventually for stuff that the iPad simply is too expensive for. For example to make a kind of dashboard out of it, or sticking it to the fridge.
Not every tablet needs to compete on all the same aspects as the iPad.
This argument is getting lost in semantics. What does "compete" mean in this instance? Does Kia compete with Lexus? They both make cars, but I doubt anyone looking at an RX350 ever ended up in a Sportage.
I'd argue "compete" should mean that someone looking for an iPad might end up buying the competing device instead.
That's the difference between a mature and a young market.
In the earlier days of motoring, the Kia equivalent would have competed with Lexus. No one would have known, for example, whether Lexus is luxury, Kia is budget or both.
The fact that you've heard of an iPad makes it significantly more likely you would choose it over the competitors even in a Best Buy. There have been mp3 players that were better than the iPod throughout pretty much it's entire existence, and they sat right next to the iPods at Best Buy and Wal-mart. They didn't put a dent in iPod sales at all. The only one that was wildly successful was the Sandisk Sansa, and the price/feature differential was such that saying it competes with the iPod is like saying Kia competes with Ferrari.
It'll be the same with these two tablets. People may buy the $200 thing because it's cheaper. Some (maybe even myself) might buy it because it's hackable. But nobody who wants an iPad will buy this instead, therefore they don't really "compete" by any meaningful usage of the word.
The first thing my dad says when I bought an iPad into my house was "hey was that that Apple thing? Pad something?" It surprised me that he even heard of it, given we're living in Thailand.
Looking at the top free/paid apps is a pretty good strategy, search, or word of mouth. The App Store promotes exploration by having good descriptions/screenshots, categorizations, colorful icons, clean text, etc. It's almost automatic for me to pop into the App Store to see what's new almost every time I pickup my iPad.