A few months ago, I had the notion to replace my MobileMe subscription with syncing to Google services, using BusyCal (whose icon is shown here) for calendars and either BusySync or Address Book's own built-in support for syncing contacts to Google. The experiment was short-lived.
I'm not saying that it isn't possible to do, but there are some limitations and incompatibilities. As one example, when you create an event on the iPhone calendar, you can create two alarms. I use this all of the time. The first alarm is a "Hey, don't forget this is coming up" reminder, and the second alarm tells me "Hey! You need to deal with this now." When syncing to a Google Calendar, you can only create one alarm. Is that a major difference? No, but it's not insignificant.
One of the important differences that Steven points out includes the fact that Google's contact records don't have "first" and "last" names, they just have "names." I suspect that this had something to do with some minor syncing corruption that crept in over time. Google Contacts also don't let you set a card for a "company." Again, it's a little difference, but when taken together, little differences add up. Trying to sync to Google reminded me of trying sync my Treo 650 to my Mac. Yes, with patience and the right software, it could be done, but it never felt right and was prone to lots of little idiosyncrasies.
Eventually, I decided to skip it all and go back to straight MobileMe syncing for calendars and contacts. Steven ends his post by saying "If you're contemplating this change, I highly recommend setting aside a few hours for research first. You may be unpleasantly surprised." I agree, and I highly recommend that you have a "known good" backup of your data before you start.
One last tip: You can usually save a lot by buying MobileMe from Amazon instead of Apple. The only way to save on MobileMe from Apple is to get it when you buy a new computer. MobileMe will ask you for credit card information so that they can automatically renew your MobileMe subscription. Don't give it to them! Instead, wait for the reminder that MobileMe is going to expire and buy a new copy from Amazon. You can save $30/year -- almost a third of the cost -- that way.