Terry, I'm told rain barrels are great for watering plants in the house, because rainwater has a sizeable amount of dissolved nitrogen in it. That helps the soil quality in your potted plants.
One thing to remember, though is to thoroughly screen the barrel, with screen fine enough to exclude mosquitos, otherwise, you're going to have a lively barrel indeed!
I left a 5 gallon bucket open-side up in the truck of my old (junker!) pickup without thinking a couple of weeks back. Just last Friday I was making a quick run to the store and took that truck. When I came out of the store, there was a wet spot on the parking spot, and I was concerned that my old pal was ailing.
Nope! It was slop draining from the truck after sloshing from the bucket...and I mean to tell you, that water was LIVELY!
I'm also guesssing, from the reek, that the inhabitants were living off a mixture of beans, cabbage, and beer!
I think you have to make an effort to keep vegetable material and insects out to have useable (not potable) rainwater.
I love gadgety, small-contribution efforts like this idea. I'm sitting here thinking about the auto-irrigation set-up I could build with a few barrels plumbed into my flower-beds in the yard.
Maybe when I get a little time...