Excellent idea that has potential and will fill a need. However, still needs some work. I plan to donate a little $ dough if the following is addressed.
Plugin installed on two WP installs that share the same DB. The one to be "child blog" was successfully told to share the users from the "master blog."
However, it seems that all those users from the master blog default to having no role on the child blog. Therefore the users cannot log into the child blog unless action is taken manually on each and every one to assign a role. This is really too much to ask especially if a blog has a large user table.
Also, it appears that a new user will also have no role on the child blog, and thus be unable to login.
This plugin is a great idea, and is moving in the right direction. Hope to see improvement addressing these issues! Thanks.