I thought this was much better than last week's episode. Like it's been said, this was a great character-driven episode that gave a lot of character development to May and showed off why these four characters have the best chemistry of any of the various group formations throughout the series. Everybody had a role in this episode, unlike earlier days were Brock and Misty would just stand around doing nothing.
There were some great comedy spots (Torchic, Ash being stupid, Butch and Cassidy bowing to Giovanni's feet in the Fantasy of the Day, etc.), nice touches of drama with May staying up at night and the ending sequence. If I didn't read spoilers I would have figured that May would catch Swablu in this episode and I was really surprised when the show faked us out. Even the music was pretty good.
I was kind of thrown off by the characters pronouncing Swablu as "Swa-BLUE," especially when Ash said it in the episode's title, but I guess the emphasis could go toward either syllable of the name... very typical birdie-Pokemon voice, but it was still cute.
I'd give the episode around an 8.5 or 9 out of 10.