first time i knew about these "lenses" (they are not actually lenses, but just a mirror "disguised" as a lens) was from a book, one of those general introductions to photography in which they tell you a little bit about everything. they mentioned these kind of lenses just as a curiosity, and argued that they couldn't actually be considered real "spy" lenses, but only some innocent toy to have a little fun now and then. I think they were right.
spazoid1965, you mention that they work best with teles --optically, as you also explain. But then, why should you need one if you're already using a tele? In such case you're supposed to be far enough not to be seen. And as xfloggingkylex says, that is actually the way to go for candid pictures.
On the other hand, if you're not far away, I would say that the accesory is not much discrete, and anyone could easily see the hole with the mirror, so that you'll end up not only as a candid photographer but also as a pathetic one, I'm afraid.
I think the idea is ingenious, but to me the actual result is a totally useless thing in which to spend the money and then to carry in your bag for the sake of a very unlikely "just-in-case"
"my two cents", as you americans say (I first learned this expression from the simpsons' Kent Brockman!

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