Having had a chance to preview and play the closed beta, which is still going on, here are some of my initial thoughts, also check out Kit Katherine who posted some nice screenshots, a more indepth preview will follow.
Hello Kitty Online starts off with the usual installer/updater and first time installers have already installed images of this game as one can see like on Joi ito’s photostream below.

Once logged in you enter a newbie area, Sanrio Harbour, where you get to learn how to play the game. The game smacks completely like your typical japanese RPG. Think Final Fantasy or Legend of Zelda, and amplify the cute kittiness by about 100 million times and you are basically there, both the good and the bad. The game has the same elements of collection and repeat aspects that traditional RPG’s have (go collect 20 strawberries), go find that hidden key in the golden deep caves of sanriolandia, you know that sort of thing. Your earnings are then put to good use in developing your assets and characters and you, of course, level up. Which RPG is not complete without levelling and avatars? It also offers a tamagotchi like feature of maintaining pets that are rare, cute and weird all at the same time!

The graphics are incredibly beautiful and cute, it’s like a burst of cheerfulness coming your way, the music is like warm applepie with little bits of sugar and cherry candy flowing your way, totally adorable.

Look at this, Toontown eat your heart out! Compare this to Toontown, the beauty of the game is no comparison, here is a screenshot of Toontown to take a look, what a difference.

I guess it was meant to be different.
The game plays in a cheerful happy manner, right not there are a few things that still need fixing but where the game really shines is the avatar and farming/housing system.

The above was taken from Kit Katherine’s blog! Anyway, you build a house, construct it with friends and guild members, you farm away and sell your goods, create juices and make spaghetti, be a cook sort of thing. The system is fun, it takes a long time to do it (mine is not finished yet) but it is a novel concept I have not seen anywhere before, the team work aspect is also interesting
More articles on this are on Zergwatch and Kit @ Vox.