
The issue is with a Development Org created yesterday.
We have a "Google Apps for Business Domain" -- vandamme.com
(I also tried it with another standard domain, with the same result.)
The Google Apps tab works fine, as does the Google Talk panel
So far, we have
* Opened Setup / Google Apps / Settings
* Configured Google Apps Doman
** Ted Husted (me)
** vandamme.com
* Activated Google Apps Services
** All the salesforce.com services
* Reviewed the Implementation Tips
* Changed email address to match Google Domain account name.
4 answers

I have it working in a demo org created through the partner portal.
It must be some weirdness with the dev org created via developers.salesforce.com
-Ted.