This adapter works perfectly with my iPad 2. It mirrors the screen for apps, I'm not sure why you'd want to do that, as another reviewer pointed out, but anyway...
Where it comes into its own is with the catch-up TV apps such as iPlayer which you can watch full screen on your TV. I'd imagine it is ideal for film and video from iTunes too. I've not tried this so can't fully vouch for it.
It is a fantastic way of showing videos and photos captured on the iPad or from stored web sources. I believe some people do like looking at other people's photos, personally I'd rather have my finger nails pulled out with pliers, each to their own though.
Some apps deliberately block adapter access, most notably Sky Go and LoveFilm. So if you think you can get a Sky sign-in from a subscriber, an adapter and hey presto!, free Sky TV, you'd be wrong. I understand where they're coming from. It's to prevent free 'multi-room' access or straight piracy. I presume they will go subscription for Sky Go eventually which should mean they take out the code that prevents adapter use.
I recently subscribed to Netflix mainly to see the 5th series of Breaking Bad which isn't out on DVD yet in the UK. Netflix does support adapter use so I can watch on my full sized TV. Netflix and the adapter are worth the money for that alone (to me, anyway).
Flippancy aside, I would certainly recommend this product, it is a definite enhancement for your iPad.