IMHO, if you are the first time iPad buyer, then go for iPad 2 ... Unless your purpose for using iPad is mainly surfing the net, facebook or other social networking, light gaming (don't care about the latest games) and want to take advantage of the price drop of iPad 1 ... then go ahead with Ipad 1.

The litmus test is when some apps (mainly games) take advantage of the faster processor/gpu/gyroscope, you don't feel you are left out.