No no no no no no no
The difference is much greater. In fact, it does collapse multiple instances of the same program, which I've always hated. But I don't hate it at all here because it's managed brilliantly. The first big difference is that programs are permanently pinned to the task bar, whether running or not. When you click on one it is subtly highlighted and outlined, to show that it's running, but it is deliberately subtle about it. Cos it doesn't matter if it's running. You want to use the program you want, whether it's already running or not. So non-running and running programs simply coexist in the taskbar and it works very very well. As for the grouping, it works well because when you hover your mouse-over the icon instead of getting a pop-up list you get a live thumbnail of each instance of the program, tiled horizontally above the taskbar. As you mouse-over each of these thumbnails it temporarily pulls that window into the foreground, so you can VERY quickly cycle through open programs just by sliding your mouse across the row of tiles. When you get to the one you want, just click on it and it will come into focus. Don't click on anything and whatever you were working on before will return to focus. Very slick.
Additionally, the icons in the taskbar no longer use text labels of any kind. Just icons (like Mac's dock). This not only looks way cooler, but it also opens up a TON of useable space on the taskbar.
Lots of little touches make it nice too. Now when you click the button to show you the hidden icons in the system tray, instead of expanding out horizontally, it opens a vertical box containing all the icons. No more of the snapping back closed when you're trying to get to one of the icons at the end and your mouse veers a single pixel off the row. Show Desktop is now improved, and a permanent fixture on the taskbar, rather than just an icon in the system tray nobody knows about.
And that's all just the task bar (and there are other cool features I didn't even touch on). There's a lot of other greatness under the hood. Hell . . . if Windows 7 looked and acted just like Vista it would be quite an accomplishment since it'll run well with a fraction of the horsepower.