Yes, Joomla! 1.5 will be a different beast, and will require more of a “migration” than an upgrade. That said, I am hopeful that it will be relatively painless, as considerable work has been done (and is continuing) on a “migration” script that will do most (if not all) of the necessary stuff “automagically”.
Of course, any site that is heavily dependent upon extensions (Component, modules, mambots) will have another whole set of issues to potentially deal with, as those extensions will have to be compatible with 1.5, and many will have to be updated.
I have installed the latest Beta of 1.5 (though I have not yet tested the RC1 release candidate), and it is very nice.
We will just have to wait and see how well the migration script develops.