Different tools have different affordances which make them useful for different things. Social conventions tend to accumulate around the rough spots. If a thing has merit, it will usually stand on its own.

This isn't a better email client. This is a worse email client. If you want short messages, XMPP is over there, twitter is over there, and facebook and G+ are over there. Pick something appropriate, please.

I always believed this was part of the goal of wave, to integrate email into a more real time setting, and was always surprised that email integration never materialised.

I think the obvious advantage of doing it over email as opposed to instant messaging / twitter is that email is ubiqutous, I dont know exactly how well the worlds email servers would handle it though :)

I think an interesting alternative, instead of bringing the advantages of instant messaging to email is to bring the advantages of email to instant messaging, threads are ad hoc rooms that people can join / leave, the server can persist message etc (I just realised I am basically saying I want wave, but with email integration and without a sucky client)

This is a compelling idea; it makes email more efficient in the same way Twitter makes blogs more efficient. There is power in concision.

However it would make a lot more sense to build it on top of Twitter DMs than on top of Gmail. Your Twitter friends expect curt messages, whereas many regular email correspondents will find subject-line-only email rude.

It seems like instant messaging would be a better fit than email for this use case?

If someone sends me a mail with a 1000 character subject, I'll delete it unread.