I'm not big into these late night programs, but definitely the way the whole thing was/is being handled by NBC is stupid.
The Conan contract - stupid. Leno is only 59, Letterman is 62. Leno had the show for 17 years, Letterman will reach 17 years in a few months. Carson was host for 30 years and till he was age 66-67. Did they really expect Jay Leno was just going to leave and do something else?
The Leno Show - stupid. Like LarBrd said, did they expect Leno to get Tonight Show numbers at 10, and Conan to get the same numbers at 11:30? They're screwing Conan, all they really did was move Leno's show up an hour and a half, and move Conan up an hour. It seems like NBC was putting all its best resources into the 10pm show.
Changing hosts when you have the #1 rated show - stupid. I'm not 100% sure on this, but Leno usually always beat Letterman in ratings right? Why would you mess with this?
I rarely watch any of these late night shows, but have always preferred Leno over Letterman. I have no idea how Leno beats Letterman in the ratings, because it seems that everyone I know always seems to prefer Letterman (and I think this can also be seen in the sentiment in this thread too).