No, you won’t be logging into your WordPress blog using an OpenID you’ve created somewhere else, but instead using your WordPress.com as your OpenID host.
A very interesting idea for their userbase. If you have a WordPress.com blog, and are interested in trying OpenID, you now have an OpenID URL, your WordPress.com blog URL in fact.
From the WordPress.com blog:

Are you fed up with having to remember dozens of usernames and password? Does the idea of creating yet another account on yet another site leave you cold?
OpenID is a new standard that hopes to alleviate some of the pain, and we’ve just made it available to everyone who has a WordPress.com blog. This means you can sign in to a growing number of sites using your existing WordPress.com account.

I am still not certain if OpenID is a great thing, or just another annoying login system. I already have an OpenID somewhere else. Do I really want or need WordPress.com to provide me with one as well? I know I don’t have to use theirs, but it still brings up an interesting problem. Can OpenID do well if everyone starts providing them?