Yeah, IAR would be much better, but right now we're not in a position to buy one just for this 1 product where we're using it in. STVD is not that bad, certainly not great but usable.
Regardless of the IDE and compiler, I'm very impressed with the chip itself. Don't mind the quirky architecture at all. I started using it mainly because of the price, but ended up really liking the chip and I see no drawbacks (minus the architecture, which the compiler handles anyway) to it, while I do see some advantages compared to other 8 bit micros. We expect our product to reach somewhat higher volumes then our other products, but the software inside is relatively simple. Our requirements aren't too specific, any chip that has an active current that isn't crazily high and has a hardare multiplier, plus UART and either I2C or SPI is fine. For this specific application I think the STM8 is a no brainer.