Looks like the two approaches are completely different.
One doesn't require the user to have to buy/build any specialized hardware. The other doesn't require the user to rely on an external service.
The bitcoin world is big enough for both approaches to make sense at different times or to different people.
And I must say that after looking into actually implementing ECDSA on tiny hardware, I'm really, really warming to Gavin's idea.
On a related note I found a commercially available smart card that supports the ECC curve bit coin uses and I have ordered samples, it provides a PKCS11 implementation which should be hook able into OpenSSL via it's engine interface. Its not the cards I though I would go with originally but they will work

1st step will be to get crypto to happen on the token, then the idea of getting a on device display for transaction or some other similar solution
http://www.athena-scs.com/product.asp?pid=33