It all depends on the latency.. both of your internet connection and the Sony machine that processes the game and sends the signal to you.
For some games a small lag is not that big of a problem but games like action shooters or beat em ups live and die by lag so for some they may become unplayable as a streaming game.
Personally i'm very interested in this service and apart from the PS4 itself was one of the other major factors that decided which console i'd buy. It's a genius move by Sony to establish such a service since the machine can't be backwards compatible for hardware reasons. The PS4 will have its shiny, graphics intense modern games but some PS3 or even older games live by the story they tell or their unique gameplay and that is mostly not related to state of the art graphics.
Now the only thing that would sour that deal is if Sony decides to rip off its customers.