For those scenarios it's a great match. For me, there's little I'd want to say to more than one person that I wouldn't want to say to everyone so the problem for me is that I want people to be able to filter that better.
For example, most of my close family and friends aren't interested in certain tech subjects, but they aren't posts I want to hide from the public, just subjects that I want those who follow me to be able to exclude. It'd be tough to pull off, but my holy grail is to be able to better filter by subject. I'd love to be able to post all the geek crap I want to geeks and not make friends want to unsubscribe but at the same time I want the posts to be publicly accessible (anything you post to a circle is not public).
If your social graph moves over there I think the circles concept would work very well for your use case though. That remains to be seen (whether it will go mainstream like FB) but it's past 20 million users already without being fully open.