When preforming a transfer operation the smart card only ever gives the private key to another smart card of the same type (they do a formal handshake involving secret keys to convince each other that they are genuine cards).  You are relying of the smart card hardware.  Now some people here claim that smart cards are be hacked-- this is true, however it is a very, very hard thing to do.  It is harder to crack a smart card then a desktop computer.  Also, the system uses a spilt key-- you need compromise both the smart card and the phone.  If you're paranoid and have access to the Internet you can check via the blockchain that the balance of public address hasn't already been spent before accepting. 

Personally, I'd feel comfortable having a thousand dollars worth of BTC on such a card-- however some people may not like to store such a large amount so they might limit themselves to only a couple of hundred or even just tens of dollars.   You don't have to put all your bitcoin on the card.  Even with just $40 dollars a day on a card most people could cover their daily small expenses, eg: coffees, smoko/lunch, parking, newspapers, lending a 10er to someone, small purchases on the Internet such as music, movies or reading material (yes this system can also be used over the internet as well as locally face to face), etc..