i've been eyeing that bag as well. i sort of agree with whomever said the hot pink and zippers look a bit punk, but i still like it if that makes sense. i also think the color would look good with a lot of colors - i tend to wear a lot of grey and other neutrals and that bag would really make those outfits pop. on the other hand, i think it's important that you love it enough to justify the price. if you love it and got a good deal on it, i say keep it.
and i would totally use it as a diaper bag - i think it would work just fine for that purpose and i don't really like traditional diaper bags anyway. hope that helps some.