Generally speaking... FT1 version is less expensive and has traditional shape and smaller orange LCD screen, while FT2 is more expensive and has wider form factor and larger black-on-white LCD touch screen. I'd say that both are similar for overall TX/RX function.
The price difference between the 2 is usually around 30 bucks, sometimes less with specials. I picked up an FT2 for 269 after rebate during this past 'Hamcon special pricing.' The FT2 is definitely worth the extra few bucks.
A friend of mine tipped me that the Yaesu FT-1XDR is available from some retailers for about $239.95. I was going to wait for the Yaesu FT-70DR, but I have read that it has been delayed. Anyway, for those familiar with the Yaesu FT-1XDR, is this a good radio and is $239.95 a fair price for this? The Eham.net reviews seem pretty favorable.
I'm curious about that too. I looked at the FT2 manual and I can't find anything that indicates it does Fusion on the B band.
I have an FT1DR, but if I had to go back and do it over again, I'd get the FT2. The biggest reason is the volume control. On the FT1 you have to press and hold a button on the side of the radio and then turn the knob the change the volume. It's a two-handed operation. On the FT2, there is a dedicate volume control knob. Much easier...