I really like the changes with i0coin, faster target block solve time, wallet encryption, etc. But I'm a little concerned that it will still suffer from difficulty yoyo-ing like namecoin does. I know it's set that it adjusts every 7 days in addition to after a certain number of blocks, but I don't think that will solve the problem. The biggest problem is that as far as I know the blockchain can still only adjust up or down 4x (or 1/4x) per adjustment. So if after the fad wears off 95% of miners give up, it will still take 3 weeks for the difficulty to adjust to where it should be.
How about a completely time-based difficulty adjustment with a much smaller range and a comparatively smaller adjustment scope. Perhaps a daily difficulty adjustment by a maximum factor of 0.5 instead of 4?