I see on the Android SDK pages, it mentions some screen resolutions to expect on Android platforms:
Small screen
QVGA (240x320), 2.6"-3.0" diagonal
Normal screen
WQVGA (240x400), 3.2"-3.5" diagonal
FWQVGA (240x432), 3.5"-3.8" diagonal
HVGA (320x480), 3.0"-3.5" diagonal
WVGA (480x800), 3.3"-4.0" diagonal
FWVGA (480x854), 3.5"-4.0" diagonal
Large screen
WVGA (480x800), 4.8"-5.5" diagonal
FWVGA (480x854), 5.0"-5.8" diagonal
Obviously, testing an app you want to sell on all these resolutions is going to be a pain. Is there any data on what percent of android phones being used use the above resolutions? My hope is that there's only really 3 or so popular resolutions...
The most common screen sizes are 320x480 (G1, Hero), 480x800 (Nexus One and Desire) and 480x854 (Droid) which is nearly the same. If you're going with a 4th resolution, it'd have to be the 240x320 for things like the Tattoo.
That said, for many applications, different screen resolutions simply don't matter. As long as you code using density independent pixels, layout-weights and the like, normally everything will just resize itself automatically. If you're doing something with graphics, yes, it's more of a pain since you might need to have different size image files. That said, Android will still automatically auto-scale many things. Have you read Supporting Multiple Screens? It's a useful link from the Android Developers' site giving some best practices on how to handle it all.