I was a Lightroom holdout for a long time but have been using LR 3 (so far haven't seen anything compelling in LR4 and want them to fix some more bugs before I bite the bullet and make the transition) for a year or two now.

It's not either/or with Photoshop. For almost any serious editing you still need Photoshop, but LR gives you a pretty decent management tool for keeping track of all your images, doing RAW conversion (that was what got me to bite the bullet finally) and some simple editing - especially handy if you have to quickly produce a bunch of JPEGs from your RAW and the files don't need much in the way of cleanup.

After I copy RAW files to my system, the worfklow is to import them into LR, sort through and see what's worth working on, use the develop module to do the basic RAW conversion and then hand off to Photoshop for editing.

I don't want to deal with subscriptions with Adobe - I can't imagine they're going to improve on their past sad record with bug fixes (new version, they break a bunch of stuff, declare half the breakage a new feature, fix one or two of the rest and then demand you pay to upgrade to a new version). If they eliminate the option to buy the software I guess I'll have to give in, but I think their value for money proposition has been going down and down and it's only because there is no other decent option that I keep paying them.l