Tried out the site out of curiosity - and admitedly with a neutral to gently negative view of the concept - and came away surprised at how it worked.
Not there enough for me yet vs playing on my own HW but much better than I was expecting.
http://www.gaikai.com/games/#Client
Lag was much less than I expected and graphics better than I expected given the setup. Suddenly playing games via a controller through my TV seems a lot closer than I thought.
Try to be reasonable... its easier than you think...