It's an interesting design. The mouse appears to be strictly reserved for establishing a source object and a target location on-screen. The action to perform using these two inputs is determined by physical buttons on the keyboard -- Copy, Move, Show Properties...
(It is slightly confusing because some operations don't need two inputs. Does "Show Properties" act upon the selected source object, or whatever is under the location of the mouse cursor?)
The mouse-oriented design that won in the market (introduced with Mac, adopted by Windows) ended up avoiding the keyboard in favour of much more complicated mouse action gestures such as double-clicking, drag'n'drop, right-click menus.
I wonder if the Star design would have been more user-friendly in the end. When I've helped older people with their computers, it seemed that they don't make use of drag'n'drop or right-click menus at all. With this limitation, they couldn't do something like duplicating a document without starting the producer application and performing a "Save As" from its main menu.
Nit picking here, but right-click was obviously not introduced with the single button Mac mouse. And the awful double-click gesture was made necessary because of this single button mouse, the original Apple sin.
In PC history, there were two opportunities to redesign the input hardware for a new kind of GUI...
First was in 1987 when IBM introduced the PS/2. It was a play for IBM to regain control of the wild west PC clone market, and failed as that, but the PS/2 keyboard and mouse connector standards lived on for more than 15 years. If IBM had revamped the keyboard at that point with something like the Star action buttons, they would have become a part of the OS/2 GUI and subsequently Windows.
Another junction was in 1995, when Microsoft launched Windows 95 and introduced new keyboards with the Windows key. At this point Microsoft carried so much weight with OEMs that I think they would have been able to push through something more radical on the input device front, if they'd wanted.
From 1968... http://www.youtube.com/watch?v=JfIgzSoTMOs
http://www.youtube.com/watch?v=Cn4vC80Pv6Q
The "look" was obviously hugely influential, the "feel" not so much. It is quite an odd beast, as the mouse is actually only used for selecting objects.
The Lisa GUI prototypes are also and interesting bit of GUI trivia. It's easy to see the Star's influence on the final shipping version of the Lisa GUI compared to its prototypes.
http://www.jeremyreimer.com/apple_screens.html