You better believe it. Otherwise, music quality will be determined by CPU processing power. Which is not the case.
RSS, Twitter, web pages with Flash, and I'm sorry, I do watched videos on the iPod Touch and when notifications do come in, they are affected though only for a short moment. So I don't personally believe you on that regard.
I have also seen music affected at the exact moment when the iPod Touch senses Wifi and activates the Wifi connection. Its slight but its there.
It can multitask yes. But once it starts multitasking many apps, it just won't become that smooth.
On the iPhone, weather is not displayed all the time nor does it obtain info as a background process. Even if the OS is made to multitask on a jailbreak, iPhone apps are still not written fundamentally to work on the background. You're just task switching one foreground task runner after another. Your weather app only obtains info when it was launched.
And yes, you get pushed alerts on your news and IM apps. I do the same on my iPod Touch no differently. But again, you still don't have any idea what a unified notification time line is. When you get a notification on the iPHone, it only displays in the front screen, transparent, disappears when you launch an app. At the same time, that notification makes the previous notification disappear, which in turn buries the next previous notification.
There is no combined timeline that would say:
SMS from Wife at 1:00pm
CNN: breaking news at 12:05pm.
Twitter reply from @dave at 11:30am.
and so on that collectively puts all events into a single log.
The end result never had equal functionality. Iphone UI doesn't have stuff like animated wallpapers or live widgets of various sizes in the interface.
I never stated that the iPhone OS isn't the smoothest OS, what I stated it achieves it smoothness by prioritizing more clock cycles to the input queue compared to every other OS out there. If you do the same on other OSes, you can achieve a similar level of smoothness.