So when iTunes Match was released as a developer beta I was very skeptical that it had any actual value. I think the reason that I was confused was because Apple hadn't settled on the exact implementation of it yet. When it was first announced they were almost aggressively non-specific when talking about the details of how it would work, carefully avoiding use of the word "streaming", and from what I've read it's even changed a bit since the first developer beta was released. Well last night I made the plunge and subscribed.
It matched about a third of my library (I listen to a lot of music from game soundtracks, indie artists, etc. that aren't on iTunes) and I finished uploading the rest of my library a few hours ago. I really like how it's been implemented, it's a very seamless (read: Apple-like) experience.
On my secondary (work) computer, once I turned on iTunes Match my entire library appeared almost instantly. Each song has a cloud button by it which lets me download it to my hard drive, but even without doing that I can play the songs and they stream flawlessly. It takes a couple seconds to start when you first pick a song but then it caches them in advance so the next song is ready to play right away. My playlists, play counts, meta data, etc. all seem to have been carried over. Obviously I wouldn't be able to stream the songs if I was offline, but like I said, you can force it to download a song and that will store it on your hard drive. You can even see the download progress right in the song list.
The experience is similar on the iPhone. All my music showed up in the Music app, and any songs which I hadn't already synced to it had a cloud button next to them. Unlike the computer, which streams the songs without storing them, picking a song on the iPhone starts playing it almost right away AND downloads it to the device, meaning if I went offline I would still be able to listen to that song, even though I didn't explicitly say to download it. I haven't used it enough to be sure, but my assumption is that if you haven't listened to a song in a while and your device starts to get low on space, iOS will automatically delete those songs from the device.
Anyways, I've done a total 180 on my opinion of iTunes Match. When I first heard about it I didn't see the point but now that I've used it I would say it's more than worth the $25/year (which is really such a tiny cost when you think about it--barely over $2/month). It's a totally seamless, easy-to-use experience which adds a lot of value for people who like to have access to their whole library but also want to save space on their device for apps, or for people who want to keep their library in sync across multiple computers.