...in the end I tend to agree with a previous poster.
I vastly prefer the currently proposed syntax in 1.5, especially for generics.
I found your style was a bit misleading for exactly some of the "casting-look" issues you mentioned. In short I'm happy with the angle brackets.
Also, I feel the new "for loop" is syntactic sugar and not really worth adding to the language. My main problems with for loops relate to the casting required for collections that don't support generics.
I can't really comment on the variance stuff so you may have point there.
Again, interesting article.