@ObjectiveTC,
Pulling up the taskbar, my brightness slider is just slightly above the 50% mark. I'm watching my Star Trek I rental (HD version) and have been for the past 45 minutes now. The sides and back of the iPad are actually slightly cool to the touch, though I am in my basement, but ambient temp is 22c right now.
I've experienced zero heat from the iPad when browsing. I was doing some really heavy browsing last night looking over comparisons between UDK and Unity for iOS development and was flicking between 5-6 tabs at any given time for about 2 hours. Many of the web pages had animated ads and content. I didn't notice any heat from the unit. You should absolutely not be experiencing overheating while browsing! If you're gaming on it for 2 hours straight, with it in a case, then perhaps I could see it getting a bit toasty as it is a passively cooled device.
I'm hoping that I won't suffer any extreme heat issues from my new iPad as I really like it so far. I bought my Dad an iPad 2 for Christmas and as soon as he started playing with it, I wanted one for myself! I knew Apple was announcing something in March, so figured I'd suffer and wait. So far I'm glad I did. I feel bad for those of you that are suffering from overheating issues.
After reading some of these updates, it seems like there might be a battery issue on some of these iPads. Very strange.