I guess you didn't understand my point(s). I'll elaborate:
First and foremost, my point is this: N1 is a crap of a phone. Having it for over 1 year, and trying to adapt it to my wife for 3 or 4 months later on before giving up on it, taught me that this phone can't be dealt with by anyone who doesn't want to accept its touchscreen limitations. It was so refreshing having the phone (MT4G in my case) just react without fuss and not expecting it to crap out at any given time - not even mentioning the huge speed-up. The price of "upgrade" (selling the N1 and buying any previous-generation phone, like DHD/MT4G/DS/DZ) can be brought down to as low as $50, and the benefits are huge, I already wrote it a couple of times on the forum.
To the storage point (actually, several points):
N1's NAND is painfully slow, compared to anything, even to regular Class 2 SD card. You can try copying any large file from NAND to EXT and back, from NAND to NAND and from EXT to EXT and see what takes more time. You're likely to discover that A2SD actually adds performance instead of hurting it.
My app data (/data/data/*) alone takes roughly the same space as your whole internal /data storage has, so I guess the amount of apps alone isn't that meaningful of a measurement. I still call it a perfectly normal and average data usage - I don't have anything special installed, no heavy games that save 200+ MB of data on internal memory, just apps like Goggles, Flash, iGO and a couple of other big apps that aren't movable by normal means (and tend to crap the system out when they're forced to move). The problem in your approach is not even the one-time amount of work you had to invest to make that space, but the amount of work you'll have to invest to keep the phone running - moving system updates to /system upon every update, clearing browser cache, etc - generally, keeping things in constant check. Free time is something you learn to appreciate when you don't have enough, and more hassle-free setup is always preferred IMHO.
But again, different people have different needs, so while I can post my point of view - I don't argue with yours.