Ok, but understand that I'm looking at this from the POV of the people I was trying to speak for... the computer-illiterate, the easily overwhelmed. I'm gonna be harsh.

So I booted it up. The gazilion lines of "Loading this, loading that" are overwhelming. However, it's just as well, since it hung on the Enterprise Volume Management System stage. The cursor would react to stimuli (I hit enter, and it'd go to the next line, etc), but nothing was
happening. So I cheated and tried stuff that I know from many years of working with computers: CTRL-Q/Z/X/C. CTRL-C worked, but I think the first time I pressed it twice, so it canceled the booting and started shutting things down. And, of course, it halted while trying to shut down the Enterprise Volume Management System. Again.
At this point I
almost gave up (since this was a test for newbs, not for me). But the Me in myself wanted to figure this out. So I rebooted, and again, it got stuck at that stage. I hit CTRL-C once this time, and after a few seconds, it resumed booting. Yay!
Ok, so after some very visually awkward hopping back and forth between the Ubuntu logo and the DOS-esque loading stat screens, it finally loaded up completely.
The next snag I ran into is very unlikely to be run into by a computer newbie, as it is because of my widescreen monitor. The system was displaying at a resolution of 1024x768 (or was it 1280x1024? I didn't even notice...), but it was stretched to fill the whole screen. So the CD icon on the desktop, for example, was stretched into an oval. Fine, needs some adjustments; wide-aspect ratios are uncommon enough for that to be understandable.
So I go to Change Resolution, but all it has are 4:3 ratio resolutions. Hmm - if that's the case, why isn't it displaying with black bars on the sides of my monitor? I open up my monitor's menu, and sure enough, the display is getting a 1920x1200 resolution signal, but what's being
displayed in those 1920x1200 pixels is actually a 1024x768 or 1280x1024 image. Weird.
Next hitch: The obscure "Show Desktop" equivalent button where I'm used to seeing the Start menu showing. I was clicking on that about 5 or 6 times before I realized that it wasn't going to be popping up any menus.
Ok, up top is a menubar, ala OS X, that has "Applications", "Places", and "System" (or something like that). Logical, yet still confusing, especially the "Places" menu. Turns out it's like Explorer, and you use it to get to drives on the computer. Meh, okay. There's also a few icons next to those menus, for the web browser, email, and something else I forget (I'm back in XP now).
There were some cryptically blank, plain rectangles (virtual desktops) and an equally cryptic icon for the trash can in the bottom right. And that's about it.
Thing I would change to make it more friendly:
Get all that loading code out of the way by default - it's ugly and, more importantly, overwhelming. Give the user some tips (starter at first, then switchable by the user to intermediate and advanced later on) during the boot process.
Upon first boot, launch a friendly walkthrough screen or something. Anything more than dumping the user into the desktop without so much as a helping hand.
Asthetically, brown is about THE WORST color one could pick and still get away with (ie. Wired green and hot pink don't count). It's ugly. This one is made bearable by a sort of sunset look to the desktop, but the UI elements have flat brown shading - yuck. Green, blue... not brown.
My final gripe has nothing to do with Ubuntu directly, but with the *nix filesystem as a whole. The directory structure is cryptic and beyond confusing. From what I understand, HDDs are under /dev/, right? Well, "dev" is always associated with "developer" in my brain before "device". Besides, why not call it /devices/? Are the extra 4 characters that valuable? Windows has made important strides in this arena in recent years, and Vista looks to be bringing even more improvements; the filesystem is understandable. "Documents and Settings" - fine, it ain't short, but it's explanatory. "Program Files" is just dumb, tho.

Anyway, the point is, don't scare away people who want to peek beyond the nice-looking, pixel-thick skin you have covering everything. I would not have been able to find my HDD had I not known ahead of time that /dev/ means "devices". It recognized the card reader drives built into my monitor; why not have the HDD's there as well?