Yes. I'm one of them, and I keep coming back to it. The short answer for why is that no matter what you think of it, GAE delivers on one basic promise: No ops/devops. I've scaled applications to thousands of QPS with teams of one or two people, and I never even had to adjust the # of instances (scaling is automatic). I've never had to worry about the database getting overloaded. It's just "write code and deploy".
Out of curiosity, what cloud provider interface do you think is better? Certainly not AWS. And which limitations do you consider so drastic?
That said, even "as-is" without any major changes on the horizon, GAE is pretty solid. My only major complaint right now is Java8, but given the choice between suffering with Java7 for another year and hiring an ops staff, I'll pick the former. I had to make "the platform" choice again just a couple weeks ago for a new startup, and still picked old-style GAE - not even the new Managed VMs, which I don't think are reliable enough yet.
Naked domains aren't an itch of mine, apparently.
The big unknown for me is how usable any of those implementations are, and whether there is such a thing as a decent migration path (for data) from Google to them, and vice-versa.
The overhead required to fit what you are serving to fit within App Engine isn't major. With a lot of other systems you have a lot of infrastructure type issues that you have to deal with. What it costs on setting up App Engine, you save on configuring a different system.
You are not going to get App Engine to do what you would normally use for a server and yes it is limited.
App Engine appears to have ceased new development and is now moving toward managed VMs. https://cloud.google.com/appengine/docs/managed-vms/
There are a lot of good and bad tools and technologies. App Engine is a great tool for some things but useless for others.