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Sandboxing sites is the cleverest move by google for a long time. The effect on us is to stop building new sites and develop and improve existing sites. I'm sure this is the case with others, and this helps google rather than swamping them with new domains all the time.
The effects of sandboxing as I see it:
1) Discourages 1 minute spammy sites that fly then die.
2) Allows google to monitor the growth of a site, including natural links in and new content, before they really start to rank it.
3) Removes the 'instant success' factor, which makes us all greedy and produce sites with little thought and effort.
In short, by removing the instant success factor, the incentive of setting up new sites has been reduced, and the incentive of working on improving older sites has increased.
Well done Google - smart move.