Gotta be honest, not that interesting. Basically says Google may bring a lot of their services to the iPhone in the form of small, streamlined widgets or apps.
Yeah, I doubt there will be a full featured SDK at WWDC, but I definitely could see Dashcode get iPhone support after which I think making an XLM-RPC compliant widget would be easy however it needs to have access to camera-taken photos to be really cool and I'm not sure Dashcode will have API support for that.