HTC Tattoo is a nice, sleek device but lacks a lot of features which HTC Magic has. I guess that is the trade-off you need to make if you want to save some money. Tattoo is comparatively cheaper than the Magic. Tattoo has a much better security, it took a lot of time for XDA developers to root this device. I hope custom ROMs will soon be available for this device. There are two key things to note before you buy HTC Tattoo. 

1) Its screen is a bit small as compared to previous android devices made by HTC - This causes certain apps to not work on Tattoo, as being a touchscreen device a lot of things depend n screen size and all.. But the benefits are longer battery life and blah blah

2) Tattoo has a resistive screen - Resistive screens do NOT provide multi touch features. (and that sucks!)

Some of the cool apps which i love and have installed on my HTC Tattoo are: 

1) AK Notepad - Awesome android Notepad. With super awesome features of combining alarm with notepad. It also gives you awesome sharing features too! And the best part - stick it on your screen till you do that work! 

2) Chomp SMS - A beautiful way to make your sms conversations look like chat bubbles! The best part about this app is "Blacklisting" feature. Blacklist all those spammy sms senders!

3) Dolphin Browser - Awesome browser with Firefox like Tab features. Fast and sleek! (Provides multi touch in multi-touch supporting phones!) 

4) Color Flashlight - This is kind of fun app! Makes your phone into a torch! Very helpful in case of power cut off in your area :D

5) Google Sky Map - Point towards the sky and it will show you which star constellation you are looking at! Super Awesome!

6) Net Counter - If your service provider also charges per usage, then this app is very helpful in keeping the check on your usage

7) Nimbuzz - For VOIP calling and chatting. 

8) My Tracks - Records your GPS tracks, good for observing the track, distance etc!

9) Fake-a-call - Nice sleek app to get a fake call to run out of meetings :D

10) Google Maps - Best free navigation ! Updated version has a buzz layer too! If you know of better free navigation apps, do let me know!