Actually it just indicates the large number of analysts/trolls who were confidently proclaiming that Google would never release Android source again.
You hear that, diBona? Keep releasing the code!
It still doesn't justify the "open source" moniker, but it's still good.
"open-source citizen" is in the eye of the beholder, if you are a die hard FOSS advocate then yes, they have failed. If you are happy with code being released when it is deemed ready (of course readiness in this case might have been influenced by marketing factors) then they have been quite successful.
And here's a thread discussing building the 3.1 GPL'd code in May. http://groups.google.com/group/android-building/browse_threa...
If you can download the source, distribute it, modify it, collaborate, and install the modified version easily on your device; then it's a quantum leap forward from any other mass-market mobile device.
In my opinion, that's huge. Right now, google is offering you the ability to actually know what your phone is doing (a huge issue when it comes to government or corporate surveillance), and puts everyone on a level playing field when it comes to writing applications and improvements, and it will likely speed up the convergence of networks so that everything is data (thus eliminating the separate billing for voice and SMS).
Eventually there will be more open, collaborative development. But let's have some patience -- PC's took a long time to be liberated (even now, many people think linux is "not ready for the desktop" and it has a small share). What google is doing is bringing linux to everyone on a new platform and already getting real market share. That's no small achievement.