I had one of these before i got my Blackberry and I'd have another. This is one tough little phone and easy to use.
YES! Absolutely be aware that some apps are malicious - be careful about what you download, Android is open source so anyone can build anything - Apple and Blackberry are harder to crack but even then it pays to be careful.
BATTERY LIFE: I had to charge mine daily - it's a smart phone - you want infinite battery life dont get a smart phone! Switching off GPS, Geo Tagging and making sure you close apps properly all help in extending battery life. Your phone will constantly check in on Facebook, Twitter and e-mail if you have them synchronised so again they won't do the battery any favours.
As this is an Android phone, you may be able to update the O/S. I did with mine and it was a relatively simple operation only taking 15 minutes. I think i updated mine to Android 2.3, not 100% sure but it worked just fine.
A MUST when you first dip into Android Market is to download AVG Antivirus. Even the free version is good and offers serious protection. Pay for the full app if you feel better doing so but the free one does the job fine.
I'd not balk at getting another of these and if you're interested in a cheap effective smartphone - you can't go wrong with this one.