Docs is a beta word processing application for the Web, and it still has some major bugs. It also has major potential.
Hosting a word processor online presents many interface challenges. It's not always clear where some functions are located. For instance, to open a new document, you must first click on the Done or Cancel buttons on the right-hand corner of the screen. For most desktop word processing software, this would be part of the File menu.
Most of the interface menu choices have been paired down from the overwhelming number of choices of a typical desktop word processor, like Word or Word Perfect. Instead, there is a row of common choices, such as save, print, spell check, cut, bold, paragraph formatting, and list numbering. There are two rows of text menus with drop-down selection, such as the file menu or font menu.
Speaking of fonts, there are a very limited number of system fonts installed, including Georgia, Verdana, and Comic Sans. This offers enough choices for most document writing tasks. Anyone wanting to do serious desktop publishing should buy desktop publishing software, rather than relying on a word processor.
If two people happen to be editing the same word at the same time, one person will receive a message that their changes did not get saved, because someone else was editing the document. This feature does work, and it's a more elegant solution than Google Spreadsheets, where the last person editing "wins," with no warning message to the other person.
Import and Export
Exporting PDFs is a handy bonus, since not all word processing programs export to that format automatically. I did experience the occasional error when trying to import a Word document, and looking over the old Google Groups Support forum, it was obvious that this is not an uncommon problem.
You can "publish" documents by giving public view-only access. You can also give private view-only access to a few people, but that option is in the Collaborate tab, which is a bit confusing. Published documents can also be "unpublished," if you decide they're not quite ready for viewing. You can also create an RSS feed to track changes, although this option may give people access to the names of documents that are not published.
Publishing to blogs directly from the word processor has the potential to be huge. Most blogging programs, including Blogger, tend to have less sophisticated word processing tools and smaller windows. It would also be handy to be able to post to multiple blogs, but you have to change your settings manually at this point.
You can save a document as an HTML file, and it exports a zipped file of the HTML document with images in a separate image folder. The HTML seems to have extra scripting in it, similar to what happens to Word documents saved as HTML. This doesn't make for small file sizes, but it may still work as an option for people who don't feel comfortable with HTML editing programs.