I think that both gadgets: Google Docs and Google Reader are helpful in saving time and effort for teachers checking on students work, organizing documents and writing feedback; and for students checking on their work, storing their assignments and organizing their projects in general.
Students have their own space to write and share. Having their documents this way allow them to have feedback from the content area teacher, other teachers and from other students and community interested in general.
In our case, having a classroom that is departmentalized, a tool like this will allow us to share and see our students' performance in all content areas. We could all have a comment about it and reinforce us as a team where students see that we are involved in all what they do academically. Both tools can be used by students and teachers. It personalizes the way we deliver and receive instruction.