So Google basically bought out Gizmo aka Sipphone and instead of improving the service they've now killed it for everyone except US-based Google-users while us outsiders can't even use their gtalk (to make calls to actual phones)? Is that the gist of it?

Bad Google!

And there's no way for the (former) Gizmo users to keep their long-standing 1-747-XXXetc number?

Well that's rather inconsiderate given that the users of that well-liked (except support) service are now losing their number, (fully paid for) VOIP access and native platform support. "Progress" works in mysterious ways.

This isn't a successful way to make Android look more attractive...

So, apart from copying gizmo phonebook elsewhere, what now?