1. It's not an attempt to replace Windows or Mac OS. At least not from the beginning. Chrome OS will be very lightweight (after all, writing a complex operating system similar to Windows is quite an enormous task to be done in two years, even for Google). It cuts off most of the bloat of desktop operating systems and focuses on the tasks that can be performed on a mobile device nowadays. Here, Google follows the trend that mobile and desktop worlds are getting closer to each other.
2. Chrome OS in its current form only enables you to work with web applications. There is a clear Google's motivation to make use of its dominant position on the web (and add as many places for ads), while trying to improve the powers and capabilities of web applications to match those on desktops. This trend is inevitable, but the sooner it happens, the better for Google. That's also why Google is so active in defining HTML5 and extending current standards. Its obvious that some demanding applications will stay on the desktops for some time, but again, it's just a matter of time (connection speed, hardware graphics acceleration) until such applications are available as web applications, too.
3. Google knows that the computer with Chrome OS won't be your main computer, or it might be your main computer in terms of time spent with it, but you'll surely have a standard desktop at home (at least that's what they said at the yesterday's conference). That means you'll carry around your "pocket" computer, and when you connect it to WiFi/3G, you'll be able to do what 95% of people do with the computer: e-mails, documents, communication, everything via the web. The computer will be secure (although the data will be stored at Google, they will be so encrypted that they will be safer than at your computer). Moreover, if you lose your computer, (almost) nothing happens -- the hard drive is again so encrypted that it's close to impossible to get anything out of it, and you'll be able to load the same old system on any other Chrome OS computer. As a matter of fact, you can switch computers any time you want, and you'll have the same settings and data everywhere.
4. Who will Chrome OS be for? Theoretically, for everyone who uses Chrome (about 50m people). Typically, for people who hardly know how to use computer and only know how to read e-mails. Such people won't have to take care of the computer any more -- it will take care of itself, it will update itself, it will take care of security all by itself, and, as long as you're connected to the Internet, it will do everything.
There are of course many unanswered questions, such as Is the society ready for this change of thinking?, or Will it play with my hardware?, but we've seen many times in the recent years that Google is able to come up with new things at the right time and is able to make them successful...