I think the difference is like this: Circles: I don't think you want to see my lolcats so I'll just deny you access to see them. Filters: I don't want to see

I think the difference is like this: Circles: I don't think you want to see my lolcats so I'll just deny you access to see them. Filters: I don't want to see your lolcats so I'll just hide them from my stream. As a consumer of my stream, I would like to have as much control over it as I can. Circles gives me almost no control over what I see. Since we don't know what Circles we've been put in and we don't see content for Circles we're not in, we really have no idea what we've missed.