I think I have a pretty good trust relationship with my kids, but there have been times where they have been half an hour late home from school or a gig etc. and the worry button gets hit. In all occurrences, it has been simple things like missing a bus, or staying back to get help with teachers etc., but those are the sorts of things that I'd like to be able to check on quickly before resorting to calling/texting.
The ability to notice something is amiss, then do a quick spot check to see "Oh, its OK, he is still on school grounds" or "He's on the number 10 bus homeward bound" is reassuring.
EDIT: I just realised that I forgot to answer your actual question re: Are my kids OK with it (the monitoring).
Neither of them have pushed back much on this. In fact, last year I developed a small iPhone app purely for the family to use to achieve the sort of tracking this Google system does. My sons were actually quite helpful in helping me design and test it out. End of the day I abandoned the app because I just didn't have enough time to maintain it, and there were other third party apps coming out that did the same thing.
As mentioned above, we have a pretty good trust relationship with our kids. Its not as if we track their every movement, and we are quite flexible with them spending a lot of time out with their friends and other sporting/social activities. It is just on those outlying times where we feel the situation is not completely 100% rosy that we like the ability to do a quick 'ping' check.