In fact, the free account has all the features of premium, except the possibility to directly upload photos which we haven't implemented yet.
Just trying the waters here with a concept that we wanted to get out ASAP, to see what people think of this kind of story visualization :-)
We definitely need to spend more time with the pricing.
Customization is probably a good thing, i.e. the subdomain and own-domain thing.
Physical stuff is always good, so I'd love to pay for an automatically created photobook/photobook-ready-PDF (I hate to do them in the crummy software supplied by the printer). Or, go one step further even and allow direct upload to Lulu. Basically a Make-your-own-coffee-table-book.
In any case, you might want to think about specifically targeting power users from the start, instead of going for the freemium market.