The 10th rule of App Engine is you cannot talk about App Engine
code.google.com
code.google.com
Sounds to me like you can mention that you use their service as much as you want. But if you attempt to conflate that relationship with something else you need to ask their permission first. Unless I'm missing something that seems fair to me.
There's a separate Trademark agreement incorporated by reference to ensure I don't dress up my app to look like a Google property.
Neither party may make any public statement regarding the relationship contemplated by this Agreement
The rest of the section is just clarifications on this.
What this section is prohibiting you from doing is using the relationship governed by the ToS as a marketing tool, in effect. It's preventing you from saying that your application is developed in a partnership with Google, endorsed by Google, supported by Google, or really anything beyond the fact that it's running on the GAE platform.
The next few sentences past the one above say that you're allowed to state that you're a customer/user of GAE, and Google is allowed to include you on a list of customers of GAE - but neither side is allowed to imply or suggest any greater relationship than that, barring some other agreement.
App Engine pricing, technical support, licenses, privacy, acceptable use, etc. are all part of the 'relationship contemplated by this Agreement'.
It may not be Google's intent, but the language says I can't talk about any of this without their prior written consent.
I'm violating the ToS by writing this comment.
Words in legal documents, be they contracts or laws, must be read in their full context.
Neither party may make any public statement regarding the relationship contemplated by this Agreement without the other party’s prior written consent. Notwithstanding the foregoing, (a) Customer is permitted to state publicly that it is a customer of the Service, consistent with the Trademark Guidelines, and (b) Customer consents to Google’s use of Customer’s name in a general customer list, but only if Customer is not the only Customer appearing on the list. For clarification, neither party needs to seek approval from the other if the party is repeating a public statement that is substantially similar to a public statement that has been previously approved.