One cent per transaction is still a "very low transfer fee".  With SatoshiDICE and its competitors gaining popularity, there will be more transactions than space per-block, so the days of bitcoin having "very low transaction fees" is likely about to become "relatively low transaction fees".

The 0.0005 BTC minimum fee will become irrelevant and market forces will determine how much the fee will be in order to get included in a block within an acceptable period of time.

As far as units, we are already seeing millibits (mBTCs) used more and more.  e.g., http://Bitzino.com and http://www.Ogrr.com both use mBTC exclusively.    Others will follow.   One millibit today (0.001 BTC) is nearly the equivalent of a U.S. penny.

At some point, the client can start dislaying mBTCs as well.

Technically, there is no such thing as a BTC.  At the protocol level, there are only Satoshis, worth 0.00000001 BTC each.

 - http://en.bitcoin.it/wiki/MilliBit
 - http://en.bitcoin.it/wiki/Units