Kelpies are my favourite breed. I have a 5mth old blue and tan male named Jasper. We got him just as a pet, but he definately shows the herding instinct - he herds all our chickens and ducks into the hen house every night.
As far as working dogs go, they are a very popular dog in Australia, working both sheep and cattle equally well. My grandparents use them for working dairy cattle, as they can be taught not to bite and can be very quiet workers. My boyfriend uses kelpies for beef cattle, as his dogs will bite when the need arises.
They are very intelligent dogs with an ingrained instinct to herd moving things. I've seen breeders take 10 week old pups with their parents to work sheep, and the pups will crouch and give 'the eye' to the sheep, even though they've never seen the animals before.
Sorry for such a long response, I hope this helps you out.