Well, I really liked the idea of the line-item veto -- which was passed by the Gingrich/Dole Congress, and signed into law by Bill Clinton....only to be tossed out in the courts as a violation of the separation of powers. I guess I understand that. But, then, I'd also say that if Congress passed laws in a piecemeal fashion (as they should, but aren't compelled to), then presidents could veto what they wanted and sign what they wanted. And, besides, Congress was specifically seeking to give the president this power. It's not like the president was trying to assume a power on his own.
That said, presidential impoundment wouldn't be a terrible substitute for the line-item veto. This merely says that presidents aren't compelled to spend funds appropriated by Congress. Presidents had this power up until Nixon and the Carl Albert-era Democrats were frequently clashing -- and Congress strictly limited presidential impoundment authority...limits that were upheld in the courts.
Most states' governors still have impoundment authority. And this helps immensely to keep the reins on legislative hijinks like this.
I think it would be great to return this power to the presidency -- for various reasons, this being one of them.