That sounds like a good idea - although I'm not sure a web service is needed to do the change. If you want to split 1 BTC into 10 * 100mBTC or 100 * 10mBTC you can always go through Bitcoin (that is redeem a 1 BTC OtherCoin, then feed the balance into 10 or 100 smaller OtherCoins).

A web service could be useful though for premium services - that is the ability to split a larger coin into smaller ones without advertising this on the Bitcoin network and also getting confirmed or balance certified coins in return. So you would give the service your 1 BTC OtherCoin and it would give you 10 * 0.1BTC OtherCoins with more than 6 confirmations on their balance (or simply with a signed balance - regardless of the number of confirmations).

I plan to spend the next couple of weeks redesigning the user interface of the app a bit - that is way overdue! Right now it displays a list of the coins and their balances and you can long click on each to access the available options (Spend, Redeem, Delete, etc). This doesn't make much sense for the average user and looks downright weird when you have more than a few coins, so I plan to aggregate the view and just display a count of coins in each bucket (1 BTC, 100mBTC, 10mBTC, 1mBTC, etc) as well as keep a "floating" BTC balance (that is a pure Bitcoin balance that is not stored on the card but available to the Android app as a buffer to either create new coins or split existing ones or as an intermediate buffer for redeemed values). This way, if you want to split a larger coin or aggregate a few smaller ones you simply select them and it internally moves them to the floating BTC balance first (gets the private key and sweeps their value), then funds the coins you want to create. This would get rid of the requirement to have the Bitcoin client on board (you can still have it installed if you want to fund the floating balance externally or want to get some of the floating balance out).