It sounds like a clever idea, and Hot or Not is a good concept to learn from; it's one of those rare, very simple viral services that have remained quite popular for a longer period of time (its popularity is now slowly waning, but most other similar services have a far more steep fall after the initial popularity burst).
Now, as the author himself has said (in the now removed Hacker News thread), it's just a little app that he had built in "about a day," and he wants feedback. But the site immediately raises several concerns.
First of all, he's using the trademarked "Hot or Not" phrase which won't go well with the owners of the original service. Secondly, the original Hot or Not asks users for permission to use their pictures and explains other users will be able to vote with them; the users of Justin.TV probably have no idea that someone is voting on their video streams. And finally, as one commenter put it on the Hacker News thread, "Every video was an underage girl in her pajamas mumbling into the camera." It's pretty much true; the service needs an age filter badly, as most older users will feel like they're browsing an underage escort service.
All that aside, the concept is interesting; if the author were able to solve all of the problems listed above, he could have a potential hit on his hands. I doubt it, though; I suspect the service will be removed very soon, so if you want to check it out, hurry up.