We were using Google Voice Chat, since it's summer break and we live in different parts of the state, and aside from a few technical problems that aspect of it worked fairly well. It's not as immersive as text chat, and I could see it quickly getting very confusing with more than two people, but particularly when the DM needs the occasional explanation of what dice to use for an attack roll, it's nice to have the speed of voice.
The game served as a lesson, and a good one for a new DM to learn: it's the players responsibility to get out of dodge when danger threatens, but it's also important for the DM to understand and telegraph that danger. He didn't quite realize how tough the monster was, and so he described it in ways that made it sound less fearsome than it was; much smaller than it should have been, for one. But at the same time, I was knowlingly flirting with danger: I had one PC and a henchmen going up against what I thought was a CL 3 or 4 critter. So I'm not annoyed about it (all my protestations and threats to the contrary), it's just a good lesson. For both of us.