What we know so far
Terraria is a 2D kludge game that combines elements of of the Metroidvania genera as well as construction games such as Minecraft. Blend, serve, enjoy. The game can be played single-player as well as multiplayer. The gist of the game is much more adventuring and exploration (and combat) oriented as compared to something like Minecraft. Building houses and such does serve a purpose of course, to attract NPCs and to have a safe place to craft objects.
Crafting seems like it will be a big part of the game, an important thing to keep in mind for Terraria is a heavily equipment focused game. No leveling up, only the collection of items and tools that make your character more versatile and more powerful. Even the increases to health & mana levels are handled via exploration to find rare consumable objects.
There are tons of different objects in game so far, ranging from simple things like axes, swords and bows to more fun offerings like rings of regeneration, cloud in a bottle to grappling hooks and guns. The game is definitely a blend of fantasy, science-fiction and horror elements all rolled together. Inclusions of mobs like the Eye of Cthulhu is a wonderful example of how the game draws upon more contemporary mythology to include fun elements in-game.
Again and again the game comes down to exploration and adventuring to find the things you need. Even some of the boss fights can only be triggered (spawned) after the character has acquired the right objects.
The world size in Terraria will vary between 'small', 'medium' and 'large' maps. As of this post the large maps will be approximately three miles wide and one and a half miles deep. These measurements may vary between now and launch and we do not yet know the scale of the medium or small maps as of yet.
The Look & Feel of Terraria
Color me biased, but I have always loved sprite-based games. Part of it is from growing up playing such things of course. While some of the visual look of Terraria that has been revealed already may change as the sprite artist(s?) do their thing, the initial glimpse we have of the game is looking very nice. Despite the limitations self-imposed upon the game, the world of Terraria is one lush with color, light and shadow all blended in good measure.
The use of lighting in Terraria is well done. While the depths of the world may be pitch black and filled with monsters, the light of stars or the moon on the surface gives some brief bare illumination to the surroundings of the player... and the inevitable approaching monsters.
The Story of Terraria
So far it seems the lore & story of Terraria will be following a simple path: Allowing the players to come up with the story themselves. As an adventure/exploration/crafting sandbox this was not necessary per-se, but a lot of people do seem to like filling in their own ideas and motivations as to why things are the way they are.
Sometimes an official story and official lore are necessary, sometimes they are not. It remains yet to be seen whether the right decision has been made on this front as of yet. All I know for sure is that the world of Terraria is heavily reminiscent (to me) of the Megaverse Rifts setting from Palladium.
The Unknown Answers: Cost and Release Date
We do not yet have solid information on how much Terraria will cost or exactly when it will be released. Price ranges of between 10 and 20 USD have been mentioned, with a potential release (perhaps a playable beta) within 2 weeks to 3 months. There are likely a lot of behind the scenes elements that have yet to be put in place of course. Login servers, databases for tracking customer information (accounts, global login servers, etc.) and any official forums and wiki projects.
Links of Interest
If you are looking for more information on Terraria, here is an assortment of links that may prove very handy in the short term. There are already a number of good YouTube videos available showing off the game, from an official trailer to a series of official LP videos showing off the alpha state of the game.
Official Website: http://www.terraria.org/
Official FAQ: http://www.terraria.org/faq.html
Unofficial Fan Forum: http://terrariaonline.com/forum/
YouTube Channel: http://www.youtube.com/user/demilogic