Google has done and is doing so many things right and so many things wrong with Google Checkout...
Consumer Side Positives:
*Google Checkout is easy, quick and convenient, once you set it up, it's ABC-123.
*Trust - I think even novice internet shoppers with a higher-then-average level of timidity regarding ecommerce safety would be easily convinced of trust from the Google Checkout Logo.
*Allows customers avoid unwanted emails via confidential purchases. (Although, this I don't understand too much - If you don't trust an ecommerce site enough to not spam you without opting-in to their email program, why the heck are you doing business with them in the first place...must be that Google trust thing?)
Consumer Side Negatives:
*Lack of flow from website checkout pattern.
*Lengthy checkout process for initial purchase.
*Yet another company holding all your CC info.
Merchant Side Positives:
*Big 'Google Checkout' Banner on Adwords - Yay! - Seriously, I suspect CTR increases dramatically with this bonus graphic.
*Free processing per amount spent on Adwords.
*Another option for customer payment (I consider this a positive, as I believe customers are more likely turned away by a lack of payment options - I do not believe customers get too confused by additional payment options)
*Directly deposits to bank account - does not need seperate withdraw ala PayPal.
Merchant Side Negatives:
*Very limited integration 1 - Thanks Google, you truly show your open minds with this one. (Yahoo Stores can only integrate Google Checkout by violating either Yahoo's or Google's TOS - Yahoo's TOS requiring checkout processing is understandably unchangeable due to billing standards - This is Google's problem.)
*Very limited integration 2 - Thanks again Google - break that smooth checkout flow?!?!?
*Very limited integration 3 - Yes maam, may I have another - Backend accounting complications - Thanks.
*Anonymous customer email option - What? - Seriously, Google...What?
Google - Change your TOS and make integration easier!