Having worked on GAE in a very large scale, my gut thinks that while this has many different use cases, it will make sense for small to medium size projects, and there will be a tipping point surrounding cost and this will appear less like a silver bullet after some horror stories.
At small scale this may even save money, if you truly don't need your code running all the time, and can deal with latency of starting your code. For projects that think terms of N thousands of transactions per second, the math breaks down real badly. It would cost approximately $2,500 dollars to run a 100ms job a billion times in a month on a machine with only 1.5GB of allocated to this process. You could pay $4350 per year w/ reserved pricing (is there even reserved pricing w/ Lambda? Couldn't find it.) for a c3.4xlarge, which has 30 gigs of memory and 16 cores, which could easily process many more times work than a billion 100ms jobs per month. So lambda seemingly works out well over 6x more than rolling it yourself on EC2 with my overly conservative napkin math.
The other pain point these type of systems produce is that instead of scaling a server here or a few servers there, your thinking in terms of processes, and time and time again this becomes a very rapid way to not only provision more horsepower instantly, but also run up the bill instantly. Code that might have ran on 1000 processes on traditional infrastructure because you had to tune it to fit in that infrastructure (and I don't mean fine tuned, things like, setting your database pool correctly and having basic concurrency), can accidentally be scaled up to 10,000 processes and appear that everything is fine. Unfortunately have seen this quite a bit on GAE and lead to some very costly mistakes.
Processes are harder (in my humble opinion) to have a good feel for what costs what, especially if your scaling up rapidly. Instead of adding a few servers and understanding how that effects the bill, going from 1000 to 1500 processes happens much easier, and you pay for that convenience.
My .02 is that this would be ideal if your either in a hurry and money is no object, or you don't plan on growing past a certain size, or possibly for workloads that are truly not running that often. I think this whole craze of lets replace everything with lambda is going to lead to rapid development (awesome) at high prices if your project takes off, which will leave developers rushing to get off of it if/when their project needs to scale with financial constraints. (not awesome)