Beta 2 still had some irritating bugs, could be quite slow in places and the UAC was annoying at times. Nothing that you wouldn't expect from B2 but there was a bunch of "stuff" that could make it irritating as a full time OS.
The later builds are a vast improvement in terms of speed, fit and finish. Most of the obvious big bugs have been nailed and it's much more usuable full time.
Personally I think it's shaping up to be the best OS release for a long time. Nothing revolutionary and most of the changes are in the underlying code rather than fancy new capabilities and UI design. It should be a lot more stable and secure with a load of the old legacy code removed and coded from scratch (sound and networks stacks being the two obvious examples).
I'd wouldn't expect anyone to "need" to upgrade from XP unless they fancied a change or was someone who regards PCs as a hobby/something to reseach/tinker with. As long as the XP upgrade price is sensible it'll be worth it though I think...