Here are my favorite Android Apps that I use on my Motorola Droid.

cyanogenmod 7.1 – community-based distribution of the open-source Android OS
launcherpro – my current home replacement
weatherbug – puts the temperature in the notification bar
vignette – camera app
hootsuite – my twitter client of choice
gmail – where my email lives
barcode scanner – what I use to scan QR codes
ourgroceries – list app that can sync with other users
scanner buddy – listen to police, fire, and ambulance conversations in your area
google voice – voicemail
bible – youversion bible
screenshot er – screen capture app
mybackup root – app backups to sdcard
sms backup – backs up sms messages to gmail
words with friends – multiplayer scrabble clone
google reader – for reading all the rss feeds I subscribe to
kindle for android – read books
pittsburgh penguins mobile – go pens
amazon app store – free apps daily