From the reviews I'vew read of the previous "Air Board" Location Free TV's, they really weren't functional.
Ok, they worked if you were on the same room with your WiFi connection, but if you went further the TV broadcast quality was simply unwatchable.
I'm not sure if they used the slower "b" WiFi, these new ones are sure to use the faster "g" standard.
And if you used it outside of your home, then the isp connection speed that the WiFi hotspot used was surely a limiting factor too (256-512Kbps connections might have been to slow then)
Today, as 1-2Mbps connestions are becoming more and more a standard for broadband, and WiFi hotspots, a Location Free TV type device could work better.
I wonder if PS3 will have this built in in some form, or if there will be a PS3 compatible "Home Base Station" that has LFTV and a HDD.
Remember it was rumoured that you'd be able to watch TV with your PSP via WiFi. It would need a device like this to work, and maybe the "play PS3 games with your PSP" would also be possible via a the "Home Base Station"
Edit: Corrected the 256-512Mbps to Kbps