I know some Python and I'm really impressed by the language's ease of use. From what I've seen of Objective-C it looks a lot less pretty, but it seems to be the lingua franca for Mac OS X development (which means it has better documentation). 
I'm thinking about starting Mac development - will using PyObjC+Python make me a second class citizen?
Second class citizen seems a bit strong. The Objective-C API's are available from Python as well, should you need them, and that's mostly if you want to make Cocoa apps. But then they are restricted to OS X anyway. Personally, I have no interest in building apps that isn't cross-platform, but that's me. That also means I haven't actually done this, so I don't know how tricky it is, but there was an article in the Python Magazine not long ago, and it didn't look that horrible.
The major drawback of Python is execution time, and that mainly comes from it being a dynamic language. This can be solved with Cython and C-extensions, etc, but then you get a mix of Python + ObjectiveC API's + Cython which can be daunting.
So it depends a lot of what kinds of applications you are going to make. Something uniquely OSX-ish that makes no sense anywhere else? ObjectiveC is probably the ticket. Cross-platform servers, well then Python rocks! Something else? Then it depends.
What are the downsides of using Python instead of Objective-C?