From my initial evaluation, it looks like they got this mostly right from a usability standpoint -- something that's quite rare for an initial toolbar release these days.
The basic features of notifications and site-specific Digg status are right on and "just work."
I especially appreciate the easy on/off switches that pull the UI for those out of my way when I'm not using it.
My only gripes so far are really just feature requests that most Digg users probably wouldn't find terribly useful. The toolbar is simple and effective and I think it fits in with the Firefox approach of including not the most or the least features, but the right features.
Click the link above to watch a short demo from Kevin Rose, or go directly to addons.mozilla.org and install the Digg Toolbar