While 16 GB may not really seem like all that much, I have found it to be fine thus far thanks to the cloud. I used almost 29 of 32GB on my SGS but on my GN I am using only 6GB so far, and most of that is from roms and emulators. I use Spotify and Google for music exclusively, movies - Netflix, photos - Picasa and G+, and assorted filed I store in Gmail and Dropbox. The only problem is flights or when I have no connection, but that really isn't that often and I will usually throw a few things on the phone in preparation for that.
Everyone has their own requirements for storage and usage though, it is still a fantastic device and probably the best phone I have ever touched IMHO.