Initial impressions...

So how does all this change the shape of writing practices? Reading
practices? Approaches to literacy?

Well, I would like to think that the ways in which images, sounds, motion etc have been integrated into texts will result in the development of more critical readers of those texts, will demystify the composition process and the results of that composition in a way that will result in readers/students better able to question texts, to see an author with an agenda behind those texts. I'm not so sure, though--perhaps we'll just end up with textual consumers who see digital texts as just as fixed, static and unquestionable as some readers still see books and other printed media. Still, since it's easier now to become involved in textual production that results in a polished, published text, perhaps it will be easier to convince readers of the need to be more aware of the agency in authorship...

And what does it really mean to be digitally literate?

Well, that’s a hell of a question. To be digitally literate is to be able to produce and read digital texts effectively, I suppose, though that’s totally a non-answer. What does it mean to be able to produce and read digital texts effectively? I’m sure it would involve a knowledge of the different options available for the construction and composition of digital texts, and the ways in which readers can (and should) be approached through those texts; an understanding of the conventions of digital communication, and the ways in which those conventions can be met or avoided; and knowledge of the technologies used to produce and improve digital texts.