I got
http://spu.co/ for the flash games development I've been doing lately. I think some traffic will be lost by people typing in spu.com or even spuco.com, but how much is anyone's guess. I think the more general-purpose your website (and therefore audience) the larger a percentage you're going to lose due to typos/unfamiliarity with the TLD.
Since my website is more of a collection of stuff I've made and I'm not going to be marketing it heavily, I think it'll be okay. The traffic it gets will likely be through links where the person doesn't have to type the domain in. An easy question to ask yourself: will you ever be putting the domain in print materials/advertising? If you can see yourself wanting to market your website in print, the .co will be more of an issue than if the only marketing you do is online, where the site will be linked and the visitor only has to click the link, not type anything in.
There are some people who absolutely refuse to use anything but .com/.net/.org, or even those who ONLY use .com, and there's valid evidence out there making their case -- del.icio.us changing to delicious.com, or the fact that microsoft has bought nearly every typographical misspelling of their brand that you can think of, for example.
And then there's the additional issue that .co is technically the ccTLD (country-code) of the Republic of Colombia, even though it's available worldwide for registration. With the .ly issue or non-issue, depending on which side you're on, that's arisen recently it could be argued that any ccTLD is potentially at risk.
Personal opinion? I think it works fine for what I'm using it and don't regret my decision. But then I love short domains (I also own http://pzxc.com and http://6d7.com, and used to own http://ui.cx/ but gave it up partly for these reasons we're discussing here but mainly because I had to use the Christmas Island registrar for that one instead of my normal registrar, which was annoying).
However if I was using it for a massive site trying to make oodles of money off of it, my opinion might change. I think if I was bit.ly right now I'd be at least a little worried, though of course I'd downplay it just as they are doing.