The add-ons make a huge difference for me. Some firefox add-ons I've come to love: ad-block (a google browser will never support that lol), integrated download manager (I use downthemall) and "mouse over/pop up translation/dictionary" tools that I use at work that save me lots of time.
I do absolutely nothing on the computer at home that isn't online based. (at the office is a different matter)
Chrome is a process manager; it just happens that, currently, those processes are web-based. However, you don't have to be connected to the internet to open a tab (process) in Chrome, just like you won't have to be connected to the internet in order to run your operating system with Google's Linux distribution. People saying "OMG BROWZER MEANS INTARWEBS REQUIRED!!!1" don't know what they're saying. Don't listen to them.
I haven't had a lot of time to look into it, but it seems like this OS is very different from your traditional OS. Everything it runs will have to be a web app. Meaning you can't install a desktop version of Word or OpenOffice, you have to use a shortcut to the online version. I imagine some apps will be written to run in a browser offline, like Google Gears stuff. You will be locked into a very limited set of applications. And it's official release will be bundled w/ specific hardware (kind of like Macs). Each laptop will come w/ a customized version to take advantage of the hardware, which will play a part in getting 7 second boot up times for example. This looks like it fits the definition of a thin client. EDIT: Here's a brief overview from Lifehacker. And a Google video: <object width="560" height="340"><param name="movie" value="http://www.youtube.com/v/0QRO3gKj3qw&hl=en_US&fs=1&"></param><param name="allowFullScreen" value="true"></param><param name="allowscriptaccess" value="always"></param><embed src="http://www.youtube.com/v/0QRO3gKj3qw&hl=en_US&fs=1&" type="application/x-shockwave-flash" allowscriptaccess="always" allowfullscreen="true" width="560" height="340"></embed></object>
It's a neat idea. Most people honestly only need the equivalent of a thin client anyhow. You don't need much to send email and write the occasional letter. I'm also fairly intrigued about the idea of mass online storage, depending on the price. Backing up data nowadays is getting a bit ridiculous. If I buy a terabyte ext hard drive to hold my digital videos, I need another one just to back it up - there isn't really a very good alternative. IMO, I might be willing to pay a yearly fee to let someone else handle the data and backups. Of course, I'd be hella concerned about privacy...