The fact that cabal-installing HAppS takes an hour is officially a bug. Hopefully this situation will be remedied as HAppS matures and, eventually, has an official release.
I found this bug pretty problematic when I was experiencing it and I know I'm not the only one. So, I will share some experiences and observations that will hopefully help others, and maybe even help diagnose and eventually squash this bug.
First of all, you don't actually need to compile an executable to run a HAppS server, and when you run from inside ghci the link time bug has no effect. So for a while I was doing this, by loading ghci using ./hackInGhci.sh and then running runInGhci inside Main.hs.
Secondly, at some point this problem went away, and my link time dropped from 5-10 minutes to under 10 seconds.
This is definitely due to a change in my own code base, not HAppS repo code, since I am only running against what I cabal installed and not the volatile HAppS library code in darcs. At some point I intend to attempt a more precise diagnosis by doing binary cuts on my repo and identifying the changes that seem to have the biggest impact. I do have some suspicions.
The shell command ./runServer.sh, which creates an executable and starts the server, also times the compile & link, and rings a bell when it's done. I figure this will be helpful if slow link times creep back in.