For editing, it delivers a better-than-average experience. In addition to a more-than-sufficient set of tools for adjusting exposure, color and sharpness and touching up artifacts like red-eye and fixing blemishes, it also supplies a basic set of specifial effects that let you turn bad or boring pictures into something a bit more interesting. The application also displays a snapshot history of your edits, which is a nice touch missing even from Adobe's desktop products. Most of the tools operate relatively quickly; only Distort left me singing the not-so-realtime blues. (Click through the slide show)
Similarly, working with the third-party sites seems painless. For instance, you can open and edit your Facebook photos directly in Express, and it sends 'em back when you're done. However, rather than replacing the photo you just edited it adds it. (I'm not sure if that's a problem with Express or the Facebook API, so I'll reserve judgment.) For the time being, all editing must be initiated from Express; initially, Adobe plans to control all development. However, the company plans to release an API later this year that should allow for more interesting solutions.
As you'd expect, Adobe has big plans for the currently free Photoshop Express, which includes rolling out paid premium services and making it a platform to integrate with desktop products like Lightroom and Elements. And though it wasn't mentioned explicitly in my discussions with company representatives, I'm sure video support and integration with Premiere Elements is in the cards, too.
As the foundation for those big plans, I view Photoshop Express with cautious optimism. Taken at face value as a consumer photo-sharing site, the Flash-based interface makes it a lot more fun and natural to use than most competitors, and the editing tools are robust and nonthreatening.