Chrome OS is an interesting idea, though I still don’t see it as revolutionary like some people. To me it’s still a terminal but unlike the VT100 uses web standards.
Regarding reliability, in my opinion you’ve added new points of failure: your network connection, and the cloud. I’ve see my network connection and web services experience way more problems than my personal computer has.
Regarding security, you’re only as secure as your password to the cloud. Since all your data is synced to the cloud, anyone who can obtain access has it. No longer is physical access necessary. Disk encryption may have saved you when physical access is obtained, but in the cloud you’re often relying on what’s available.
Regarding cost, this becomes a toss up. On the plus side you can have cheap hardware. You don’t need much storage, or CPU. On the downside, your a slave to your network connection for even the most basic tasks. We’ve yet to enter a world of free wireless, and even broadband services are looking to switch to metered service as a replacement to the “all you can eat” plans we’re used to. A change to how bandwidth is priced can ruin this model overnight.
Lets not forget broadband performance in the US is far from stellar. Web UI has improved greatly over the years, but it’s hardly at the level of desktop applications.
Personally I see little value at this time for cheap hardware in exchange for giving up most control. I can replicate all the functionality of Chrome OS using a web browser, and get the added bonuses of a full operating system.
Would I use it? Perhaps as a throw around netbook, but not as a primary computer, or even for serious work. Maybe one day, but not in 2009, and I highly doubt 2010 will close all those gaps.