I think that recording everything is almost useless, without a good filter (approaching AI levels). The real power, I think, comes in recall and referencing. Just as an example, I've been reading "The Stars my Destination" and two words came up that I didn't recognize (epileptoid and asthenic - funny, FF doesn't recognize them either!), and it would have been handy to just look them up quickly.
As to "forgetting", people already abuse current mnemonic devices (such as photos) to "hold on" too long, and using people's words against them is a problem with or without perfect recall.
For trade secrets, etc, you do what any high security facility does: recording/transmitting devices left at the door, outside, and simply accept the crippling that comes from lack of instant access to information.
Also, what's wrong with living inside Emacs? ;P
Edit to followup: Works of fiction I've found interesting in this vein include "The Final Cut" (even with the poor execution) and "Strange Days"; anyone have any recommendations along these lines?