I live in Hemel Hempstead, and therefore, similarly to Jeremy Smith, know the section of the Grand Union from Hemel to Tring best, though I've been as far North as Milton Keynes on it on a few occasions, and as far South as the junction with the Regent's canal in London. I agree with Jeremy - the surface is very variable. Getting on towards MK, there are a few miles which are awful. At the London end, ther are metal gates intended to keep motor-bikes off the towpath while letting cyclists and walkers through. In fact, they're a pretty good deterrent to cyclists as well, and they come every mile or less. If your bike is non-standard in any way, it may not go through the shaped gap without a struggle, and even if you're simply carrying panniers, as I assume you will be if you're touring, you'll have a struggle.
Also, while I use towpaths a lot, I have to say that after a while they get boring. I'd combine them with other types of route if I was planning a tour. Still, each to his or her own.
Off-topic a bit - great, fairly flat day-ride starting and finishing in Hemel Hempstead (or anywhere else on or near the route): To St Albans on minor roads, then along the Sustrans 'Alban Way' to Hatfield. Across Hatfield to the start of the Sustrans 'Cole Green Way', which takes you to Hertford. In Hertford, turn right from the end of the CGW, then left, and past County Hall. Straight across the town centre roundabout (not literally...), then right and through MacMullen's Brewery. Follow cyclepath to the Lea Navigation towpath, then follow it all the way into London, until you get to the Hertford Union Canal, off to the right. Follow that and the Regent's Canal and the Paddington arm of the GUC all the way across London until you get to the GUC proper (you have to leave the towpath a couple of times and ride a mile or so through London streets, but the route back to the towpath is fairly well-signposted in each case). Turn right and follow the GUC North, all the way back to Hemel Hempstead. You'll get seriously fed up with the afore-mentioned gates on the towpath, but most of the route doesn't have them. Total distance, approx. 100 miles.