In short, he's not (too) worried:
If Reading List gets widely adopted and millions of people start saving pages for later reading, a portion of those people will be interested in upgrading to a dedicated, deluxe app and service to serve their needs better. And they’ll quickly find Instapaper in the App Store.
Having just installed the Safari 5.1 developer preview for Snow Leopard, which includes Reading List, my first impression is that it's really, really basic, more like a scratch pad area for bookmarks than a true Instapaper clone. (One can sort of approximate Instapaper's experience by combining the Reading List and Safari Reader features, but most people I suspect will never try that.)
That's good for Marco, good for readers, and good for me — now I can stop keeping URLs to my Desktop when I want to save a page for later that isn't Instapaper appropriate.