Interesting to see that WriteWith seems to take GoogleDocs head on! There seems to be a few parallels between what Kiko attempted and how they were hosed by Google Calender and what WriteWith is attempting.
The difference here being WriteWith launching after GoogleDocs and it being marketed differently. Looks like WriteWith is creating a niche within collaborative doc editing, by catering to and marketing as a collaborative blogging platform. Brilliant concept! Truly catering to the long tail of bloggers!!
Well, I definitely feel its not hard to picture Google looking at WriteWith and realizing that there is an opportunity there for them to leverage from their existing systems and just establish a connection between GoogleDocs and Blogger.
The incremental effort required to bridge the gap, seems minuscule, especially on the Google scale. One of the possible Google efforts would be, WriteWith getting an irresistible offer from Google. I am sure the founders won't be complaining then!