Google is turning into a corporate cheer leader where large companies dominate the rankings (revenue grab? knocking out the small business?). Type "e" and I got: ebay, espn, expedia. "s" - skype, sears, staples. Randomly type 2 letters: "be" - best buy, bed bath and beyond, etc.
I think those are more likely searches more than anything.
What happened to independent results?
They still exist. To be fair I've been using Instant Google since the beginning and now I don't even look at the results until I've finished typing. Personally for me it has made no difference, as I still work the same way I did before.
Bigger brands can be a mixed bag; does everyone want to visit Best Buy when they search DVD? Not necessarily but Best Buy is a leader in the field with significant products and content (good for google to index), lots of links (weight) and of course a sizable marketing team trying to optimize. That's a lot of reasons for them to legitimately rank well... but it's not a guarentee, look at longer terms and you'll see issues with some of the big guys ranking.
I think this sums it up really. The Instant Google feature does not really affect anything, it's like a gimmick that people will only look at when they come to the end of their search. It's those final results that matter. Not what comes up when you type "s". As you will probably type "sk" and then look for "sky". People are over exaggeration this feature, and there is nothing to be afraid of.
I feel this feature will aid new-comers (like my dad) and old folks to use Google easier. Since many new comers don't have a Google Account I think it's not really relevant at the moment. This feature ideally should be activated without a Google Account.