I concur that Pandora and Slacker both are really bad to listen to via the Droid. I had them both on my Blackberry Storm, and both sounded 100% better on the BB. On my Blackberry, the sound quality of Slacker was better, plus had the ability to cache stations, so if you were driving and out of range, or in an airplane, you could listen to the cached music. So far Slacker on the Android does not have the ability to cache, however rumor has it that it is coming soon.
I also read today that iheartradio is coming out on Tuesday next week, so we will see.