As part of some work we're doing, I put together a proof of concept leveraging the functionality within the FeedAPI and Views.
It's a pretty simple site -- all it does is bring in some selected feeds, import any existing tags, and add on some additional tags set on each feed as it is added to the site.
But it starts to get fun when you use views to organize the content based on author, taxonomy, etc --
I was also amazed at how quickly the site came together -- like I said, it's basic, but the basic config came together in about 6 hours.
In short, the FeedAPI is an amazing piece of work. I was looking forward to filing some bug reports, and I never got the chance :)
My blog post is at http://openacademic.org/news/aggregation-proof-of-concept, and the site itself is at http://feeds.openacademic.org/