Battery life is a bit below par and there isn't nearly enough detail on that page to asy if it's actually any good.
No idea what range of video formats it supports but it's not going to be anywhere near the likes of an Archos. Chances are you have to encode video to a certain specification to get it to play on it.
You would defintely need a better set of headphones. At that price, whatever you get with it is going to be garbage.
Finally, my brother in law bought a very similar device on Bid Up TV for 99p just before Xmas (+ £6.99 delivery) and you can pick up similar generic MP4 players on Ebay for about half the price of the one you've linked to.
Personally, I wouldn't buy it.
For double the money (possibly less) you can get a pretty decent little Sony ... or a Samsung ..... a bottom end Cowon .... a bottom end iPod (? dunno ... how much iPod does £80 odd get you?) .... etc