I was using this on a project for a while. But compared to running the application with PHP, it was always slower. Sure, I've developed applications with PHP since 2001, so I really know how to tweak it and optimize it. But, with App Engine it was really frustrating. Requests really took long to complete, and there was no real way to figure out what was going on behind the scenes. We created an 'always on' instance, but it was still quite sluggish compared to the exact app running on a standard linux, apache, PHP system.

I would still try it again down the road, but it's really not a good fit for what I'm currently doing.