Was messing around with it yesterday and it was a little glitchy with NLog. Funkbox audiobused to Loopy, then switched over to NLog and the note would play... I'm too new to know the term, but basically it was stuttering due to lack of memory. Just tried again, didn't work. ThumbJam worked fine. As did Sunrizer. Rebirth ran really slow and I wasn't able to get it to load. Not sure if anyone has any work flow suggestions (the scene in Apollo 13 where they're trying to load the module comes to mind), but it seems like for some apps AudioCopy may still be preferable on the earlier iPad. It's still really cool to be able to record straight into Loopy though, so your mileage may vary.
There are definitely some severe limitations for the functionality of audiobus on the iPad 1. It's similar to the limitations you'll encounter when you try running multiple synths at once using midi and the apps start to crash and/or the midi gets out of whack along with the sound. I've still been able to do some useful things like recording into MT DAW with Jam but when you start getting three apps running you're bound to have issues with the apps crashing when you switch between them. If you're expecting to use audiobus on an iPad 1, please do your homework to make sure that what you want to do is even possible. Even with severe limitations it's still nice to have it running on the iPad but I think it'd be very marginal unless you have more recent iOS devices.
On the positive side, it seems widespread adoption of audiobus will encourage developers to tighten up their code as audiobus users will want to run as many apps in as many different combinations as possible. Someone should start working on an app with the latest audiobus app compatibility where they get feedback from the user community as well as the developers about how functional different combinations of apps are in audiobus.