I've just got hold of a live version of KDE 4 alpha 1 on a live DVD that came with this months copy of Linux Format. I am writing this review from Konqueror on KDE4, and it seems to mostly be working.
The most noticeable thing about this alpha release is that it doesn't look that different from KDE 3.5 to be honest. The new file manager is Dolphin which looks a bit like the Gnome file manager to me. I really liked Konqueror as a file manager, so I'm not entirely convinced by this change. This alpha did at least reassure me that the developers haven't actually got rid of the address bar in the file manager, it appears when you click the bar where you'd expect it which is a great relief. I often find I know the path to at least the folder that I want, and to browse there takes an uncomfortable amount of time because you have to go through some folder with thousands of other files in it to get to the one that you want.
As an alpha release, it's quite passable, the release status is apparent though with some annoying bugs, like the fact that kdesktop (the process managing the desktop and icons) doesn't start up properly on it's own and many of the icons have not been re-drawn for the new theme, meaning there are a lot of question mark logos about.
Also I'm hoping that the Konqueror's html rendering is not running at fully polished level because considerable parts of this site disappear at some points in the loading cycle.
However, I'm look forward to the full release of KDE 4 and I'll be looking out for more alpha releases later in the summer.