This depends on your target users. If they only live in the Netherlands for example you have to target different devices than USA or China.

Testing on a few devices across the dimensions (resolution, dpi, cpu, manufacterer, keyboard[less]) then you are pretty save.

But I have experience where we tested on a range of devices, but the app still had problems on 1 or 2 specific devices such as the sony ericsson xperia mini.

So if you have the money I would recommend something like testdroid to be increase your testing confidence.

I have a very crappy 99$ android phone[1] with gingerbread, a Nexus S, a Nexus 4 and a Nexus 7. Everything is tested on all the devices to make sure it works. I think that with this devices I can catch pretty much all cases, from low end to high and tablets.

[1] http://www.huaweidevice.com/resource/mini/201008174756/ideos...

Any one you can get your hand on that gives you both a large and small screen (eg a Galaxy S3 and an older Sony), as well as one running 2.3 (still very common) and one on 4.2, with anything inbetween a bonus

You can sift out some bugs already using the Android emulator (using various Android versions). Saves time and money :)

Also, don't forget about different browsers (on mobile phones).