What are the trade-offs between transacting on Lightning Network and Bitcoin mainchain? Lightning network's first prototype code is online, so it's about time we learn more about what it is. (At least I wish some people would…)

What are the expected trade-offs of Lightning Network to Bitcoin mainchain?
Some points that would be nice if they got covered:


privacy
confirmation speed
fees
time until spendable


And for the bonus: Will Lightning Network be centralized?
Below describes these points during what's planned to be normal operation. Once a channel needs to be torn down because of a problem with one of the nodes (evil or accidental) some of these answers are a little different.


privacy - Privacy is not a linear scale, but there are a few factors that clearly improve privacy:


Very few transactions actually end up on the permanent and public blockchain. And those are a payment from you to an LN node (or vice versa) and there is no record on the blockchain of the actual destinations (or sources) of the money.
Routing of messages (and LN transactions) will be done in a Tor like fashion (Onion routing) with encryption of the message such that intermediate nodes can't read the transactions nor do they know the true origin or destination (IP address) of the transaction.
To obfuscate your actions, you can pay to yourself from one channel to another, and I'd assume it's a lot easier to do quick and trustless mixing through LN.

confirmation speed - You don't need to wait for any confirmations at all, so transactions are truly instant. Network latency (multiple hops) will be the deciding factor as all encryption and other overhead is low even for relatively low end hardware (phones).
fees - Every hop will want a little bit of fee for the service of forwarding your transaction. This can be pretty tiny though, allowing for true micro payments. In some cases nodes might want to balance out their channels and give you negative fees depending on which direction the money is flowing. This will create an interesting market between all the nodes offering their services and keeping fees fair and low.
time until spendable - Immediate. Any money you receive on a channel you can immediately spend again (through the same channel). If you want to settle on the blockchain and then spend the bitcoins there, you'll first have to close the channel, which under normal conditions requires the standard 10 minutes confirmation time (you don't need more confirmations, although the person you are sending the Bitcoins to might still require 6 confirmations).
centralized - The software is fully open source. Any one can start up a node, put some Bitcoins in and start offering their service to the network and earn some fees for doing it. This low barrier to entry and ease of use should provide enough competition and enough nodes to make it decentralized. 

There are some caveats: people will have to put some funds into the node that are at risk if the device gets hacked (initially possibly through bugs in LN, but in general through any malware or badly secured and outdated operating systems). This might be a slightly centralizing force as security is relatively cheaper to do at scale.

DOS protection might be something to think about too. Maybe have the option of using a 3G phone or other channel invisible to the attackers (even sneakernet!) when a true attack is underway and you need to close some channels before they expire. Very little bandwidth is necessary to do that, I'm not sure a DOS attack make uploading a few transactions impossible anyway.

Also I think it's required (or maybe just wise) to run a full Bitcoin node (possibly pruning) on the LN node. LN needs to have access to the blockchain data in a trustless way and need to be able to send transactions to the Bitcoin network reliably in case it's necessary to tear down a payment channel (within a certain timeout). A pruning full node is not that bad to run, but there's a bit of cost that would be lower in a centralized situation.