Short answer: it depends.
We still do most of our projects in Drupal 6, mainly because it's been around a few years, and modules we use on many sites are not yet stable for Drupal 7 (and some are still a ways off).
However, for sites that don't need particular modules, Drupal 7 at its core is a nice improvement.
My first Drupal 7 site is a personal one, http://www.hikeswithhazel.com. So far as a user, it doesn't seem that different from Drupal 6, especially if you turn off the "Overlay" module which pops open editing screens in what I find to be a highly annoying way.
Here are the changes I'm noticing, as an administrator:
- Administration menu has been reorganized, and generally I would call it an improvement.
- Field support for all kinds of new things: comments, taxonomy terms, flags -- this is perhaps the single biggest noticeable improvement, and eliminates the need for a lot of custom modules.
- Missing a couple really nice modules for rapid deployment, menu_editor at the top of the list.
- Overall not that much difference, just a general improvement in lots of little ways.
The biggest differences are under the hood, with two big improvements to point out:
- Simpletest integration. Drupal 7 has a huge number of automated tests to discover things that break. Drupal 6 had none. Because of this, we think we're going to see some huge improvements in the quality of module updates, and much fewer broken sites as a result of upgrades.
- New field api and object-oriented entity class system for development. These will take some time to learn, but should greatly improve the developer experience for more custom functionality.
The biggest reasons we still do most of our sites in Drupal 6 are pretty much entirely missing modules or modules not yet ready for production:
- Signups, for event registrations.
- Ubercart, for most e-commerce needs (though we're eagerly anticipating moving to the new commerce module for Drupal 7 for clients with modest e-commerce needs) - we know Ubercart well enough that we can quickly deploy it, as well as know what's solid and where the gotchas are. Things Ubercart has that still isn't there for Commerce include shipping modules, a lot of payment gateways, Washington state sales tax, and more.
- Casetracker/OpenAtrium modules. We're doing a lot more projects involving deploying project management tools, and these are lagging behind getting migrated to Drupal 7.
Should your project use Drupal 6 or Drupal 7? I would say there are three crucial questions to ask to answer that question:
- Do you have needs beyond the basic content management that Drupal 7 already covers very, very well? If so, need to evaluate whether the modules you need are ready yet.
- Are you on a tight deadline? If so, an experienced Drupal shop can likely get you up and running faster with Drupal 6, mainly because Drupal 7 is so new and brings with it a new learning curve.
- Do you have a tight budget? If so, again I would suggest that experienced Drupal shops can deliver on Drupal 6 with less risk/less variability on the estimates. I would recommend having extra budget for Drupal 7 sites, at least until it's been proven in production with the modules you need.
If you can answer no to those questions (or at least no to the last two, and can fund the upgrading of the modules you do need), Drupal 7 is clearly the future. Drupal 6 sites will need to get upgraded when Drupal 8 is released, which is probably at least a year off, but probably less than 3 years. Generally you want to run the newest version you can, because it means it will last you longer before you need to upgrade.
The verdict? Use Drupal 7 if you can, but we expect to be using Drupal 6 even on many new projects for another 4 or 5 months at least.