With the release of Twitter as a universal app that now includes iPad support (read the official announcement here) I feel confident that the reports of the death of 3rd party Twitter applications have been greatly exaggerated.
The UI for Twitter for iPad is, without question, unlike any other Twitter application that we've seen. Opinions around the TUAW offices differ on whether this difference is "awesome" or "an abomination." I definitely range towards the latter end of the scale, and judging by most of the comments of people that I follow on Twitter, the initial reaction is definitely one of "too busy" and "over designed."
This is in sharp contrast to Twitterrific, which just released a major update for the iPad and iPhone where the Iconfactory made dramatic simplifications to the app, while retaining the most important features for the most users. (Craig Hockenberry talked about those changes here.)