There are a bunch of behind the scenes things like tightening the security and anti-phishing, but I'm not much of an expert on that. As for the user-end of the upgrades, a couple of things I am liking is the ability to add/delete new search engines quickly (although there were add-ons to do this for FF1.5), the minor tweaks to the tabbed browsing bar, and the addition of a spell checker if you are writing web-based email or posting on message boards (the spell check can also be turned off). There is also the option to turn your bookmarks into "live" bookmarks, where for example if you have cnn.com bookmarked the bookmark will display the top headline. I haven't really been able to look deeply at everything that's new, but those are the things that are most apparent.
The first time you fire up FF2, it automatically checks if your extensions from FF1 will work for FF2 and imports over the ones that work. All my add-ons imported over except for one, and the one that didn't is now a feature built into FF2 from the start.
