From my own personal experience, I have installed Ubuntu/Xubuntu on my wife's machines, and she was able to do everything she uses her PC for without difficulty. And she is a typical (non-geek) user. Of course, she has live-in tech support if she needs it, but from a usability standpoint, the *buntu's are there now. She doesn't really notice much of a difference from her experience running Windows.
I don't get caught up in semantics, like the RMS followers do. What most people call "Linux" is indeed a distro, not just the kernel. It seems some of the more successful distros have distanced themselves from being called "Linux." See Ubuntu, Fedora, CentOS, Android. So the "operating system" is a set of programs (incl. GNU, etc.) which run on top of the (Linux) kernel. It's a distro, and if people want to call their OS "Linux," what is the harm? Of course, Mac OS X (and by extension iOS), is UNIX-like at its core, using the Darwin kernel, which itself is based off BSD/Mach.
I really wish GNU/Hurd was stable, but I really doubt that will ever happen.