Currently you can create two types of widgets, social applications for social networks like Myspace and Facebook that has full access to the profile information and news feeds and other widget for start pages like iGoogle and Netvibes, ofcourse this can be placed on social networks also.
Example of social applications include data widget and highscores widget, media widget, data lookup widget and others. Data widget is for user activity on a site. For example you have a website like Lifehacker where users contribute often by commenting, you can allow your users to widgetize their comments and share it on social networks. So when their friends see their widgets they click through and visit your site. This way you can increase your traffic and provide value to your users. I think this is a good concept, if large sites and blogs can adapt this strategy they can easily increase their traffic.
Another useful widget is datalookup widget, with this widget users can enter the tracking code of their shipments of FedEx, DHL, DHL and see the status of their parcels.
iWidgets is currently in beta, for testing you dont need to register for the site but if you want to save your widgets you need to register and login. Although it has some great features it is not easy to build, first you need to understand and have a clear idea of what widget you are going to build. If you have ever used Yahoo Pipes then you can easily use it to create widgets, the whole widget building looks like Yahoo Pipes interface.
This is a killer application for sites looking to make use of the social media to increase their brand and traffic.