This isn't just some random guy coming up with a way to run linux on a PS3, it's actually that a company that makes this "yellow dog" linux distribution is going to have an official release for the PlayStation 3 console.
That's probably a plus I'd say, because many of the home-brew ones (iPod Linux, Xbox Linux, etc.) aren't very stable sometimes. I've had experience with both of the above, and you're better off without them.
This is where it gets interesting:
For those interested in the convenience of buying software off the shelf, Terra Soft will also offer a version to be sold next to the PlayStation 3 in retail environments.
Basically, what this means is that you WILL NOT need to go through the pain of installing a mod-chip to get it to work!!! No more ripping apart your console to solder onto your overpriced console's motherboard, risking damaging it beyond belief!
Anyone think Sony will file a lawsuit? I know Xbox and PS2 home-brew apps were completely illegal because they used some of Microsoft/Sony's code to work. This may not be though, because it sounds like they are going to have a way to installing it without hacking up the original firmware by Sony. If it allows pirating of games (and I'm sure it will) Sony will probably be against it, but it will be like the VCR case from way back when. It has legal uses, so therefore you cannot outlaw it.
On the other hand, pirating games for the PS3 will probably be very impractical. Bluray disks can hold anywhere from 8-200 GB of data. On an average torrent on my computer for downloading a game, I get around 50 kBps. That's almost a 50 hour download for filling up the lowest end model of the disk. On the other hand, let's figure it out for 25 GB (the speculated size of the disks that the PS3 will use). 145 hours. That's over 6 days that your connection will be basically useless because your bandwidth is completely sucked up by your torrent client. Given, on certain torrents, especially right after release, you can get well over that speed, but the fastest I've ever seen on a torrent is still only slightly over 200 kBps.
So there's my two cents. All in all, this is pretty interesting. I'm going to be following this, and I might actually think about spending some money on a PS3.