I tried Tango tonight and called my brother on his iPhone. It was not bad. Video quality was pretty good, but the sound quality/issue was as described. I had to use a headset and there was A LOT of static on the line. Hopefully, they will get all of the bugs ironed out soon. However, it is good to see all of the replies from the Tango people on the forums here and other places. I think it is a good sign that they are keeping a finger on the pulse of their end users.
One thing I like about the app is it very nicely integrates with your contacts. IMO, much better than Skype does.