If you think there is no any difference in @reply and @mention when used in your twitter status message you are so wrong! I have lost quite a lot of my messages exposure because of this mistake. I do not have thousands of followers but I am running twitter web 2.0 app that pushes a lot of status updates for other users. And because of my "small" mistake I have been loosing a lot of exposure till today! Twitter stuff write about it on their blog as a feature but for me it was a pain to get to know about it. And probably most of you don't know how it works exactly.
Most of twitter users use twitter nicknames with AT symbol on the begging during conversation with others. But there is one more hidden functionality than showing it on @reply tab of somebody's twitter account. When you @reply to someone with his nick on the beginning of your status message then this update is seen only be those who follow both of you! You and him. So others can't be a part of the conversation until they visit your twitter account directly (like http://twitter.com/yournick/).
Now you know what is a @reply. So how @mention can be different? It works the way that most of us would expect for a @reply. You use @mention instead of @reply only if you put it in the body of your status update (never on the beginning!). Such message is seen by all of your followers and it is linked to account of person that you @mention.
Like for me it is just a huge misleading and @reply should be no different from @mention... If someone have not looked to twitter FAQ most probably he has no idea about this difference. Even twitter stuff writes on their blog that usually no one knows it...
So who needs a feature that is not known and so misleading? Do you think it should be called feature or rather a bug...?