Hi DanF,
I don't actually see InfoPath competeing with traditional web forms very often.
Right now InfoPath is a rich client solution that requires InfoPath installed on the PC of every user who wants to fill out a form. InfoPath was designed to be used out of the box by your regular old MS Office user. Regular old users of MS Office can create forms quite easily, including submiting to a database, forwarding via email etc. I don't think you will find that many office users who can just start coding in HTML and then make data connections using VBScript etc. InfoPath is an excellent solution for small companies (or big companies) that want to empower employees to collect data without the need for a big IT budget to do so.
InfoPath forms can also be used offline, can be submitted via email very easily and integrated with company workflow processes.
InfoPath forms are also a lot easier to design and start using than web forms. I've designed web forms myself so I speak from experience. This is not to knock webforms in anyway - I don't think InfoPath was designed to replace traditional web forms in the first place
For very specific business processes InfoPath is much better than any webform. And the same can be said for webforms.