Re: It is cowardly and something something else...
My impression is that their original intention was to be extra "cool" by showing off that their products are constantly being tinkered with, and therefore are forever improving. Hence, re-defining the term "beta" as A Good Thing (tm).
After the first year or so of some of their beta labels failing to show any sign of disappearance, a few bloggers and news analysts made a point of this: of course the beta label remains indefinitely, said they; Google is constantly changing the applications, so it's a new kind of software development cycle. The Google Kind of Beta (tm).
Apparently, this didn't catch on as well as Google wanted to. Well, it may have among the blogging, mytubeing, facetweeting, youspacing geeks, but not amongst the enterprisey suits and the serious technologists, who are the ones with the big cheque-books and the industry clout.
A "new kind of beta", indeed.