This is interesting, but it seems like it would be limited to fairly simple projects and programs, until "wire-clutter" set in. I would like to say it would be of benefit to "newbies", but I tend to feel that it won't, because it would obscure a lot about what happens in electronics, interfacing, and software development, that is ultimately important if you need to do anything complex or interesting - as well as to being safe without burning up your Arduino or other components.
For experts, such a system would be nice (in a certain degree) to remove the clutter of a system in prototyping, but it still feels a little limited to me. For it to be ultimately useful, you would want it to generate a schematic, netlists, PCB traces, etc - but if you are at a point in your skills where you understand all of this, you are probably already using Eagle or something anyhow.
The one place where this kind of a tool does have value, though, as Lego has learned, is with children. So I can see this kind of a tool being useful for introducing and teach children how to use an Arduino. However, if they are to then transistion into really understanding microcontrollers, schematics, electronics, and programming, it will be soon after using a tool like this (or they might get stunted - really, these visual flow diagrams are in some ways worse than BASIC for teaching programming skills).
Seeing something like this, though - I wonder why nobody has created a ladder-logic visual environment for the Arduino (I guess not much call for it - they certainly don't use it anymore in the industry; but I wonder if it could still be a useful teaching tool)...?
It will be interesting to see where you take this (and interesting to see how this is received by the community, compared to Fritzing, compared to Eagle, compared to gEDA, compared to...).