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I sold a 17-85 IS and got the Sigma for my wife for her XT. The Canon 17-85 IS was (as is the Sigma) a compromise given the zoom range, although the USM focusing and IS were very nice. At the wide end, the Sigma seems sharper, less CA, etc. than the Canon. In the mid range, I don't notice much difference in practical use. Of course the Sigma wins from 86-200 where it seems to be surprisingly sharp (much better than the Sigma 70-300 APO for example and on par with Canon's 70-300 IS).
Wide open at 35mm this lens gives soft corners, but for our use as a general purpose and travel lens it isn't a problem. The good news is that the center is sharp at all FLs, the OS works great (good 3 stops), and AF is accurate, all in a 11X zoom at an affordable price.
My 17-55 IS and 70-200 f4 L IS costs around $2K and the Sigma costs 1/4 this amount so we really can't expect it to compare and be flawless. But, this lens is a one of a kind for Canon bodies until Canon sells a 18-200 IS that includes USM, better IQ, and likely a higher price tag, although I'm not sure I would want to pay any more for this type of lens.
IMO, the Sigma is a good alternative for the 17-85 IS and 70-300 IS combo at about 1/2 the price and all in one convenient travel package. In fact, we also tried the 70-300 IS and we weren't that impressed (build quality was poor and our copy wasn't that sharp above 200mm, but it could have been a poor copy. Couple the Sigma with a decent prime (50mm f1.8 for example) and you have a decent walkaround/travel lens setup.
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