In my opinion, this group is still wide open. With Sehwag and Uthappa, India are capable of beating anyone as are England with Pietersen and Flintoff.
India should take the opening partnership as a huge positive, Gambhir and Sehwag the future Indian opening pair in ODIs and twenty20s? Sehwag has not changed and that is great, he is slightly uncouth in his hitting but extremely clean and it seems that everything that beats the outfield races for four. India must learn that six an over while rebuilding is not quite enough and that the odd boundary must be attempted in a period of rebuilding - it is a lesson to be learnt.
The bowling was poor but it was mainly due to poor bowling selection in my opinion. Sreesanth has too much zip off the pitch and with the length he bowls, the ball seems to fly on and off the middle of the cross bat in the latter overs. Someone like Pathan (or RP Singh) who does not come on to the bat but more cramps up the batsman at a lively pace with steep bounce would be a better choice. Harbhajan may be a surprise option for death bowling too, Afridi tried to hit each of his balls for six in the Pakistan game and Harbhajan kept his cool and barely went for any runs.
India did not look like a team in their third twenty20 international! It was a fine effort. As far as selection goes, I would have Agarkar out and Joginder Sharma/Yousuf Pathan in. India were visibly a batsman light today and should go with the extra all rounder who can fulfil the bowling criteria and hence Joginder is my first choice, but Yousef could be good on a spinning pitch or on a flat one where 200 is a necessity.
Now, I am not the expert but do live in England so here is my take on them based on the highlights. They bowled tightly, especially Flintoff and Anderson. The catching, and this coming from an India fan, was awful, they dropped and missed some sitters. They succumbed to good bowling from Pollock and sharp bowling from Van Der Wath and Morkel, without Luke Wright and Kevin Pietersen (what a dismissal btw) firing, they could not score at 7.5 an over needed to win. This happens in twenty20 when your hitters fail and you don't have back up hitters, it should be taken as an unlucky defeat more than an outclassing since on another day, England would have no doubt taken the catches and chased the total.