I own the 18-55 IS, and the 17-85. I personally prefer the 17-85 over the 18-55 IS. The focal range really came in handy, the AF was really nice. Image quality was acceptable in a trade-off vs. the 18-55
Having said that, no way would I buy a 17-85 for $430 more. Back when the 17-85 came out, I was able to buy it for $440 thanks to a rare discount offer. Today, if I was going to spend $430 more for a 17-85, I would instead considering saving more and get the 15-85.
If you don't want to save for a 15-85, get the 18-55 kit. It's an awesome deal. It's also really small --- the smallest zoom lens with IS you can get. My 18-55 still gets used on my old 350D, making a really small DSLR setup.
My 17-85 is being used by my sister who prefers it over the 28-135 on her 7D (hopefully she'll get around to buying the 15-85).