I’ve not seen the interface yet (it’s Windows-only, and I’m, well, not). But assuming (a) it’s easy to turn on or off and (b) users can tell what’s an auto-link and what’s original to the webpage I see the application itself as just one more shift in power from the author to the audience, just like TiVo, ad blocking, style-sheet overrides, those DVD-reediting kits for people who don’t like the dirty bits, the remote control and the highlighter pen. I’m in favor of all of them.
There is one thing that does concern me though, and it’s not the application itself, but the bundling of the information source with the Google Desktop app itself. There’s not much they could do about that (and I trust Google a lot more than I trusted Microsoft when they tried this same trick), but I would feel much better if this were a generic open API in my Firefox, where I could pick and choose who handles each of my rewrite rules. Even a benevolent hegemony is dangerous, both in case it stops being benevolent and because it lacks genetic diversity.
So, who’s up for writing an auto-link Firefox plug-in?