There is an entire class of digital photographers who would benefit from the Belkin reader - serious amateurs and "prosumers". People who burn through 100-200MB of storage on a typical day of sightseeing and picture-taking. Sure, these people could just get an extra 512MB card for the same price as the Belkin reader, but that card would only last them an extra day. What happens when you go away for a long weekend? Or when you go away on vacation for a week? Or for six weeks as I just was? It is most certainly worth $100 to have an almost limitless supply of image storage and the freedom to leave your laptop at home or not have to shell out an extra $400-500 for a portable storage device like the FlashTrac.
And one last thing, who says the Belkin is designed for 128MB cards? It's more accurate to say that it is designed for users who will only need to clear off their memory cards about once a day - people for whom its not a problem to let their 512MB card upload while they're eating dinner or watching TV. Oh, and one last last thing. Cameras are hitting a practical ceiling for resolution - there is a certain point beyond which extra pixels are pointless, and todays cameras are almost there. IMHO, the ceiling for consumer cameras is 5MP, 10MP for prosumer, and 16MP for professional. So, I don't think you'll see consumer cameras getting much higher in resolution.