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There's a lot of comparisons between this and the cheaper 20mm f1.7 Lumix, and I while I have both, I'll list a few reason you why you want this lens instead of the Lumix (especially on the OM-D, or Olympus bodies).
1.) Much faster auto-focus. It's got to be more than several times faster, and rarely hunts. This makes it useable for quick, on-the-moment snapshots that you would never get with the Lumix. This is extraordinarily frustrating, as the camera gets in the way of your picture taking, instead of being a quick and easy instrument that just works. By far the primary reason for my purchase of the Olympus 17mm f1.8.
2.) Greatly reduced purple fringing (on Olympus bodies). Panasonic bodies will auto-correct for this, but if you're using an OM-D like me, this is a huge difference. Even with chromatic aberration correction in Adobe Lightroom 4, there's noticeable band of grey as the software removes the purple, particularly in the corners with the Lumix, where the fringing can be severe in certain situations. The Olympus 17mm f1.8 naturally works without creating excessive fringing.
3.) No more banding on the OM-D. The 20mm Lumix has a particularly nasty habit of creating horizontal or vertical bands that show up in the shadows, which becomes more and more visible the higher the ISO rises. I don't know who's fault it is that the issue exists, but changing to any other lens removes the problem. You would usually love using a large aperture lens in dim lighting, but not the Lumix/OM-D combo.
Those are the top reasons, but there's some (somewhat negligible) nitpicks notes that go either way.
1.) The 20mm Lumix has a cool color shift, towards a very slight blue-green tint, while the Olympus 17mm tends to be a little warmer, which I prefer.
2.) Much is made about the the Lumix being a sharper lens, but the Olympus is still acceptable. Noticeably better than the usual kit lenses for any similarly priced manufacturer, much less a regular point and shoot. Honestly I haven't been able to tell much difference unless I zoom in on small text in the far corners.
3.) Vignetting is noticeable on either lens, especially used wide open. The Olympus is slightly, but noticeably darker.
4.) The metal housing is very nice, as is the general look to the Olympus in my opinion. The painted gunmetal colored plastic on the Lumix is a little off-putting (wish it was just black).
5.) Both are pretty expensive relative to cheap things (you can buy whole cameras for the price of either lens), both are relatively cheap compared to expensive things (other lenses of similar performance from other manufacturers can cost much more). Price is a really difficult to thing to agree on.
6.) Neither lens is very big or heavy, but the Lumix takes the cake for being more stow-able as the flatter dimensions are naturally even more compact, and a bit lighter.
7.) The Olympus is super quiet to focus (I can't hear it), great for video recording. The Lumix has that typical grinding sound from cheaper lenses.
8. Bokeh is a toss up to me. Neither one is has any terrible misgivings from what I've seen.
9.) If you normally shoot 35mm equivalent, the 20mm Lumix (40mm equivalent) can feel awkward, especially in close quarters.
10.) If you have a Panasonic body the choice is a lot harder. If you have an Olympus body, the Olympus lens makes more sense, assuming the price doesn't bother you.
Overall, I think the Olympus 17mm f1.8 has its own spot nicely settled. Unfortunately it's not particularly outstanding in performance to it's other prime siblings at 12mm f2.0 and the 75mm f1.8. But then again, it's about 60% of the price. I feel a lot of the cost went to the metal housing, and it probably would have cut US$100-150 if they just used the plastic housing of the 45mm f1.8, which would have made it a no-brainer against the 20mm Lumix of Olympus body owners. But since that's not reality, the best I can give is 4 stars, probably 3.5 if you own a Panasonic body.
Other people may feel differently, but this is my opinion.
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