Based on my experience using the iTunes App Store, it is quite usable and looks a lot better than none at all.
Some things that make it instantly better than purchasing iPhone apps from your computer:
1. This web interface is lightning fast, iTunes is horribly slow. 2. You get to use the standard browser controls over the random clutter of controls in iTunes. 3. Pressing "install" installs to your phone without having to plug it in, or sync, or worry about losing your shit.
I think it's a great first iteration, and it's definitely something that has been a long time coming.