I have a strong feeling this is going to do very well in the UK. I currently have a Kindle Fire and although I really like it, the fact that it's locked to the US is very annoying.
Amazon have really lost out by not getting a Fire to market in the UK. If the Nexus comes out first at this price it will easily become the de-facto low cost tablet.
At ?159 it's within the reach of a lot of people and is justifiable as birthday / christmas presents (which for me the ipad is obviously not).