It wasn't defective - it just wasn't something that my bedridden mom would be able to use intuitively.
Having the hangouts be part of the Google+ infrastructure is hurting it's uptake because most people see Google+ as something they don't bother using because they're on Facebook instead.
But either they don't care that much about it, or they are afraid of the carriers reaction - but they really shouldn't be. The users should always come first.
I got a prompt asking me to do this the first time when the functionality was enabled, and now all my video chats are hangouts. Makes sense to me, as it's essentially the same functionality + the ability to invite multiple people to the video chat + include additional apps that add to the video chat functionality (live editing Google Docs, for example).
I have to say, I was pretty disappointed with the actual quality of audio calls (not a huge fan of video chatting with friends) when compared to Skype. I've tried many times over the past few years, but Skype still kicks Google's ass in terms of call quality. Is mine an exception to the general rule, or is this true for most people?