Jon Hanna mentioned in a mailing list that I am on that there is a published exploit of Google (a script insertion flaw) and worse, this exploit also affects the Google Desktop Engine.
In light of this, I would strongly advise against installing the Google Desktop Search until this has been resolved satisfactorily.
The real story here though to my mind is that google were warned about it 2 years ago and only fixed it this morning after Jim considered the extra dangers with the desktop app decided to just go ahead and publish.