Turning on iTunes Match on my iPhone is problematic. I have tried it, and it works most of the time. But it doesn't work often enough to compell me not to enable it. THere are issues with songs that were not sync'd before you turn it on. Basically you have to stream those, which fails when you don't have good connectivity. Also, some business block this traffic at the firewall. If I have to think about whether a song is on the device cache or not, the thing is not worth the trouble. I keep iTunes match for the ability to save my music to the cloud, more or less, as a back up copy of my library updated automatically.
Having iTunes Radio tied to this feature doesn't make sense to me. If you are subcriber to iTunes Match, they should just authenticate that, and play the radio streams. I don't think Apple is motivated to make iTunes Radio all that good because it is likely to cannibalize the cash cow of their iTunes music sales. That's my opinion anyway.
I maintain a Slacker subscription for like four bucks a month. Much better option for radio for me.