It makes plenty of sense for me, and I think it will do very well IF the rifles and ammuntion are priced similarly to other rimfires. One of the really cool things about 17 HMR is you can buy a very accurate, flat shooting (within reasonable ranges) rifle for the mid $200's. I guess the kicker will be whether rifle manufacturers can chamber this round in their existing platforms. Also, I agree with the above posters, this kind of thing would be perfect for places where you have to use rimfires on coyotes or hogs, or even places where you don't want to grate on the neighbors too much.
We reloaders have to remember when judging products like this, that we are in a miniscule minority amongst shooters. I think the 17 super mag could undercut the 17 hornet with most non-reloaders, even though the 17 hornet is under $1 a round, its still more than twice as expensive as the proposed pricing for the 17 super mag.
Does anyone know what rimfire Winchester could introduce this round in? Do they even make a rimfire repeater anymore?