Amazingly enough, version 8 no longer sucks. Version 7 was awful, but v8 looks much more Mac-like and is quite a bit faster. Much as I love Preview, it has trouble searching scanned + OCR documents, and also doesn't seem to handle PDFs with built-in forms. Also, the Adobe Reader browser plugin has search built-in, which Apple's standard plugin doesn't. So there's definitely place for both Preview and Reader.
The biggest problem with Reader is installation. Rather than simply downloading the application, you have to download an installer, which then installs a "download manager", which then downloads the real installer, which finally installs Reader. WTF!?
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