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The d-pad and buttons are designed like that so you can place your thumb right in the center and tilt it in the direction you want. The spacing of the buttons and the d-pad directions certainly isn't something to complain about in my eyes because there isn't anything inherently wrong with what they did.

Analog placement is not a problem for me, so I guess your mileage may vary there. My thumbs do have to lie on top of the sticks in order to use the d-pad and buttons, but there is enough resistance where I won't ever input something from the analog sticks when I didn't intend to. It also helps that I don't have to move my thumbs around much due to the aformentioned reason, so there is little chance of input error there.

The only real problems are the grip of the system and the PS button, Start/Select buttons. They are too annoying to press and the form factor of the Vita causes hand cramps after about an hour or two of play time. But these have been addressed with the 2000 model. Also I wish the shoulder buttons had more of a click to them and didn't feel smushy like how they are now. In regards to other problems with the Vita, those damn memory cards...