It's a fun project to get into Android with. I imagine that my pizza/date money income from the project is going to disappear now that Marco is working on Instapaper full-time (as he's probably working on an Android client).
If you can make your client work exceptionally well and fit the Android mentality, you have an opportunity to be fairly entrenched and beat out the official client - I wouldn't give up.
One thing Marco does well is think out every user interface decision and add polish to the product. If you don't do that, and he does release an Android client, that could kill your app's success pretty quickly. Polish is something Android is lacking pretty heavily, and we all notice it when it's there.
I think my app has polish, and it's slowly getting better, but most of it based on the official app adapted to Android UX patterns.
Either way, Marco is nice enough to allow third party clients and I've made more than I thought I would already.