Got around to seeing this today.
I really enjoyed it. I don't know if I'd call it better than Iron Man, but it could certainly be Favreau's second best film, and definitely the best Disney live-action remake so far.
The CGI was impeccable. All of the motion capture/voice actors did a great job, especially Murray, Kingsley and Elba. You could tell it was Neel Sethi's first movie, but his performance improved as the film progressed (for example, he seemed flat during the scene where Shere Khan first tries attacking him, but he was fine during the confrontation at the end).
As for the musical numbers, I actually liked Walken's "I Wanna Be Like You". At least sang better than Mowgli did on "The Bare Necessities".

But the best one was saved for the credits with
Scarlett Johansson's performance of "Trust in Me". That should have been in the movie.
My only disappointments were the [BLACKOUT]underuse of the elephants and Kaa. Colonel Hathi's March was one of my favorite parts of the animated movie and I was bummed to see that not only was the song left out, but the elephants didn't speak at all. And I was really hoping for Kaa to show up again at some point. Maybe in the sequel...[/BLACKOUT]
All in all, it was a great movie and it really improved on a lot of what the original had to offer story-wise. Disney is just firing on all cylinders right now.