There are hacks around it and there have been improvements since I played with the framework. However the hacks are ugly... I wrote a little tiny procedural 'music' app when I first got my Nexus One (android 2.2 i think). This was a workaround for lack of midi support and the latency issue. Anyway, not a shameless plug, its free and no ads, was just a "learn android" thing and was never polished at all. I'll dig out the code and get it up on GitHub if anyone wants to play with it.

[0] https://market.android.com/details?id=xian.bubbles&hl=en