There were way more than 16 iPad apps available at launch, and the ones that were available were also top-notch quality (especially the Apple Pages/Numbers/Keynote suite).
3 months is an eternity in this industry. No one's going to pass on an iPad or iPad 2 in favour of a Xoom on the vague promise of more apps coming in 3 months.
You sound like you are lamenting what ought to be, instead of what actually is, today.
You could've said the same about the G1. It was a piece of crap compared to the competition. Yes, if you're a consumer who really needs a tablet this month, you'd be a fool to buy anything but the iPad 2.
But if you're a developer, Android is only just now a viable platform for tablet-sized apps. I don't think the market will explode quite like what's happened with Android phones, but the Motorola Xoom is the first legitimate Android tablet. There will be many more.
I don't see any compelling reason to buy a Xoom unless you're an enthusiastic developer or tinkerer. Personally, I'm happy to continue using my first-gen iPad until the iPad 3 comes along. But if you're talking about the Android platform rather than this one device right now, of course the future matters.
3 months is an eternity in this industry. No one's going to pass on an iPad or iPad 2 in favour of a Xoom on the vague promise of more apps coming in 3 months.
You sound like you are lamenting what ought to be, instead of what actually is, today.