One thing to think about is that it lowers the cost of a defense if you're relatively sure you'll win.
Under the current system, a plea bargain is something like "Take 2 years in jail and pay $50-100k less or face 10 years in jail at trial, where you probably can't even afford a real defense."
Under the new system, a plea bargain would have to offer considerably more to the point it's obviously problematic, because acquitted defendants wouldn't still be out the money required to beat the system. Further, it's likely poor people will have better access to top notch lawyers if the lawyer can expect to recoup their cost from the state (rather than just not being paid by the poor person).
The other nice thing: you could actually get lawyers to work on the grounds of "you only pay if we win" for criminal cases. This would, presumably, mean "state-provided" defense lawyers would be the best available, as opposed to whoever they can scrounge up as a public defender.
Also, presumably, the cost of good legal defense should be less than the $20,000 cost/year for incarceration.
