I use many Google tools on a daily basis, but Google News was not one of them. I usually just check CNN and WCCO for my daily news. When I went to Google News, it was a little confusing at first. After I discovered the "personalize" option, I rearranged the news categories, deleted "Sports", added my zip code to get local news and created specialized searches for geocaching, letterboxing, treasure hunt, minerals and fossils. I was amazed at the recent activity in all of those searches!
For student use, I think this would be a better option than Google Alerts because it is an immediate resource. I'm not sure it replaces our databases, but is something that would be available anytime and anywhere.