According to 9to5Mac, changes introduced in iOS 4.2 have caused Apple's Camera Connection Kit to become a lot less useful for iPad owners. As of iOS 4.2, the amount of electricity the iPad's 30-pin dock connector can put out has apparently been slashed from 100mA to 20mA. While this is good news for the iPad's battery life, it's bad news for anyone trying to connect almost any unpowered USB gadgetry to the iPad via the Camera Connection Kit; most USB keyboards, flash drives and USB microphones won't work via the Camera Connection Kit anymore. Instead, connecting a USB device that draws more than the allowable 20mA will throw up an error: "The connected USB device requires too much power."
For its original purpose, plugging a self-powered camera into the iPad to upload pictures, the Camera Connection Kit should still function as it always did. Many users were happy at the unexpected ability to use non-camera devices with the kit, and those same users will undoubtedly be dismayed that it's no longer possible. Hopefully this new behavior is a bug rather than a "feature" in iOS 4.2 and something that can be addressed in a future update.