Basically its laid out pretty clearly (see section 11.1) that if you use the API to display *your* data, then you grant Google a irrevocable licence to do as it sees fit with your data.
Sure it says “You retain copyright and any other rights you already hold in Your Content. ” – first, to soften the blow, but then goes on to say “[to] publicly perform, publicly display and distribute Your Content. ” – I dont see how that is any different to saying they can do what they like with your data.
It gets worse if you have “business listings data”, as 11.1(b) says: “For example, if you create a store locator application, Google may use the business listings information from the store locator to improve the Google Services such as Google Maps and local search.”
– give your data away free to Google why don’t you!
Here is Ed Parson’s (Google Geospatial expert) take on the new TOS.Google Maps API Terms of Service Update by Mike Blumenthal