Yep, Google is open for business.
http://www.nytimes.com/2010/12/07/bu...+hO7jEklfeoiXA
Apparently they are setting up some kind of affiliate-type program, so independent online bookstores can resell Google's ebooks.
It will be a mix of agency and non-agency priced books.
I'm sure it will work offline, but the basic idea is that the "home" of your purchases is in the cloud (Google's servers).