My partner is one of these applicants from the US. For us, it's not something we're intending to take advantage of any time in the foreseeable future. Maybe we'll retire in Victoria some day, but ultimately it's just a cheap thing we can do to keep our options open. I don't think this should be read as saying that there'll be hundreds of thousands of Americans moving to Canada.
There's a lot of Canadian expatriates in US history, so I'd presume a large chunk of multi-generation US Americans are eligible, so it makes sense that they'd represent a large portion of the program.
Bill C-3 allows citizenship for those who can prove they're descended from a Canadian ancestor, even if that ancestor left the country several generations back. It was adopted after the courts ruled that limiting citizenship to the first generation born outside of Canada was too restrictive.