I've not seen anyone else comment on it yet, so I'm going to jump in and forestall the OMG-Google-Store-Huge-Amounts-Of-Data-About-Me-I'm-So-Scared raving loonies that are inevitably going to come out of the woodwork:
Google Web History is not evil for two reasons:
A) It's explicitly opt-in
B) It doesn't represent Google collecting more data about you; it represents Google giving you more access and visibility of data they collect about you anyway.
To use Web History, you have to first download the google toolbar; then, you have to explicitly choose to enable the PageRank button feature. It's not turned on by default, and the screen which asks permission turns it on explains that if you turn it on, Google will know about every page you visit.
After that, you may need to go to the link above and choose to enable the web history feature - although I'm not certain whether this just turns on displaying of your web history, or if it controls whether the web history is stored at all.
Assuming you download and install this toolbar, and assuming you then choose to turn on the PageRank button, Google will be collecting this data about you. If they're collecting it anyway, which would you prefer - that you have no idea what they've collected, or that they show you what they know about you.
Google Web History is not evil. It does have privacy implications, and you should heed the warnings you get when turning on the PageRank button in that toolbar. If you're not comfortable with Google having that much information about you, don't enable PageRank.