My current car is a 307cc. Before I bought it I was told the same stories as you were, but I was so impressed by its looks that I didnt bother to listen, and it turned out to be a right decision. I have it for 11 years now and I had no issues with it. The only problem I had is with the windows mechanism, because the cc has no upper frame so all the weight load for the larger window glasses falls only on the mechanism (not a good thing on the bumpy greek roads). It can be permanenly solved though.
My previous car was an Alfa 146. Nice car, my fathee still owns it, but the after sales service was not so good.
My fiance has the 207. It had an issue with the engine after 7 years, but it was easily fixed (it cost 500 euros). Other than that, it runs smoothly.
In general I am very pleased with Peugeot, both as car quality and from their after sales service, so I am currently waiting for my new 2008 to arrive.