I'm encouraged to hear this. I've been kind of surprised that after losing 40 pounds or so a lot of people don't seem to notice. It's interesting to see who does and who doesn't--my closest ones are always screaming that I look so great and oh my god! but some pretty good friends either haven't noticed or haven't felt like it was their place to say anything for fear it might come off wrong.
As for me noticing changes, I'm notice it in my clothes, on the stairs, during my workout, in my face, in my boobs
(kidding) I should definitely do the picture thing and chart my progress regularly. Especially for those long vicious plateaus where it can feel like nothing is happening, but with exercise the bod does still keep changing--amazing machine!