There are two things to note from Terrence Williams' first few days with the Sacramento Kings: he's getting playing time, and he produced in his second game with the team.
Keith Smart hasn't been shown to hand out playing time just because, either in his stint in Sacramento or last season with the Warriors. (Ask Jeremy Lin.) That Williams immediately began to get minutes shows either that Smart wants to see what T-Will can offer or that the coach has been impressed by the wing's effort in practice. When Jimmer Fredette is playing so little, doling out 24 minutes to a dude on a 10-day contract over two games actually means something. Exactly what? We can't know (even if Smart gives an answer, because he's not going to sell out this kid so quickly). Williams basically took John Salmons' minutes on Monday. Salmons has been playing well, and was a starter from darn near half the season.
Williams produced against Houston. He had 10 points on 4-7 shooting in 16 minutes, and hit 2-4 from long-range. His production and efficiency won't be graded one game at a time when the franchise determines whether to make an effort to keep him next season, but producing in one game gives Smart whatever cover he needs -- I'm not sure he needs any, but who knows? -- to play him again. This is almost a repeat of the Isaiah Thomas-Jimmer situation. Smart boosted Isaiah's minutes and made him a starter because he produced. He continued to produce, so when Jimmer began to produce, Smart never felt pressure to replace Zeke with Fredette. If Williams produces, Smart cannot feel pressure from any corner to re-insert Salmons or Fredette into a larger role.
Given Williams' comparative upside (especially relative to Salmons), I think this is a good development. I'm not a fan of seeing Fredette get fewer than 10 minutes, but the backcourt jam is complex enough that it's hard to fault the coach too much. (Other perspectives on this are generally fair; I'm sympathetic to arguments that getting Jimmer at least 15 minutes a game should be a priority.)