Question: Is it important for the domain of a website to be chosen so that it is simple to type?

For example, consider delicious-dot-ly (`delicious.ly`).  

Would it be fair to say that the difficulty of typing this domain name leads to a bad user experience?

Answer: 
Yes, there are a few considerations for domain names: 

* **Is the name memorable?** Could your domain name be confused with another address, such as goggle.com vs. google.com?
* **Is the name easy to relay?** Can you tell another person the name by saying something like "penny-dash-arcade-dot-com"?
* **Is the name accurate to your brand?** If your site is "Cheap Pens Now", it better be located at cheappensnow.com!
* **Is the name unambigious?** All I have to say is "penisland.com" -- PEN ISLAND, you perverts! How about expertsexchange.com? Y'know, Experts Exchange...

Most of these concerns are strictly branding related issues, and if your service is that good, like bit.ly or del.icio.us, people will forgive quite a bit -- as long as you get the rest right!
Domains are important for getting users to your site, not so much once they are there, that's the time for your interface, design and service to shine. 

A few points on marketing;

**Clarity**

If you are planning to promote it via word of mouth / radio / TV / telephone the domain should be;

1. Phonetic (spelled like it sounds)
2. Easy to spell
3. Avoid hyphens (if you have to have separators, hyphens "-" are preferable to underscores "\_").

**SEO**

If you are planning driving traffic via SEO, if you can get a keyword in there, it helps. 

Be very wary of domain hacks. Domains like "make.it", "dance.in", "lun.ch" may sound cool, but unless your markets are Italy, India or Switzerland respectively, you'll have to work twice as hard in SEO to rank in your local Google.

**Credibility**

Users often perceive as less trustworthy:

1. Overly long domains e.g. "credit-card-interest-calculator.com"
2. Less common common TLDs like .eu, .info, .us etc (rather than .com, .co.uk, .net etc)

**Geographic relevance**

Specific TLDs can be a strong indicator to a user that the service applies to them e.g. "widgets.com" will usually be assumed to be a US site, whereas French visitors will be more like to use "widgets.fr" as they know it's a service they can access. Also the point about TLDs and local domains apply.