Is google app engine right for me (hosting a few rapidly updating text files created w/ python)
Yes and no.
Appengine is great in terms of reliability, server speed, features, etc.  However, it has two main drawbacks: You are in a sandboxed environment (no filesystem access, must use datastore), and you are paying by instance hour.  Normally, if you're just hosting a small server accessed once in a while, you can get free hosting; if you are running a cron job all day every day, you must use at least one instance at all times, thus costing you money.
Your concerns about speed and propagation on google's servers is moot; they have a global time server pulsating through their datacenters ensuring your operations are atomic; if you request data with consistency=STRONG, so long as your get begins after the put, you will see the updated data.
I have a python script that creates a few text files, which are then uploaded to my current web host. This is done every 5 minutes. The text files are used in a software program which fetches the latest version every 5 min. Right now I have it running on my web host, but I'd like to move to GAE to improve reliability. (Also because my current web host does not allow for just plain file hosting, per their TOS.)
Is google app engine right for me? I have some experience with python, but none related to web technologies. I went through the basic hello world tutorial and it seems pretty straightforward for a website, but I don't know how I would implement my project. I also worry about any caching which could cause the latest files not to propagate fast enough across google's servers.