I would go for Android over iOS for a Tablet, the reason being there isn't much more you can do with an iPad than you can your iPhone.
Also most Android Tablets have Flash player, enabling you to watch web content built in to web pages, which you can't do with iPad (unless jailbroken).
Android is the biggest OS for Tablets out there, and being open source, many Apps are free, for example, Angry Birds costs 59p on iOS, but free on Android.
In a nutshell you can do more with Android than iOS, and there is much more choice, but for your budget you should be able to get a decent Tablet, I'd suggest the Motorola Zoom, looks pretty nifty to me...
Anyway, good luck!
since you also want to do some work I would recommend the Asus Transformer mainly because with a dock you get the addition of typing and extra battery life
IMO the xoom is really heavy...screen isn't as good but is really solid
I agree. To me and others here, Honeycomb is more of a streamlined desktop experience rather than an upscaled mobile platform like the iPad. Basically, you can still have the flexibility and customizability of Android but also features a unique implementation of the UI; it really feels more suited for tablet usage. App count, though significantly less than in iOS, is still quite a lot for users and most apps still run on the OS without any scaling or performance issues.
I'd look at something like the ASUS Transformer, which costs $399 here which is less than what the Xoom asks for ($600) yet offers most, if not all, of the specs including Tegra 2 and 1GB of RAM.
regarding playback of 720p...its mainly a hardware limitaion I read....go check out the XDA transformer dev thread