You can watch a sample video clip inside a Picasa Album here. This video was uploaded by Haochi, who discovered the video upload feature in Picasa from ZMarties. [via Philipp]
While the resolution of videos on Picasa Web is just the same as other videos on Google Video website, the only difference here is that videos are stored in your own personal space and you have absolute control over visitor comments on your videos. You also get 6 GB of extra storage space to save your video files on Picasa.
While the $25-6GB deal sounds good, why not use the "unlisted feature" of Google Video to upload private videos and share them with only those people you want to see them. And unlike Picasa Videos, there's no storage restriction on Google videos.
Related Reading: Picasa Web vs Flickr - Flickr provides 4 times more photo storage space than Google at the same price.