Interesting stuff. I would love to hear the reasons for not building a virtual desktop using smooth transitions like these. Instead of trying to merge more and more stuff into the taskbar.
It does really help to partition your workspace to stay in control. So it would go well with that theme. However I could see it confuse a few people, but it should at least be there for power users.
There are many programs out there trying to simulate this function through windows hide/show. With the new taskbar this approach doesn't really make sense in the same way as before. Also the transitions are quite jerky. Eventhough the flip 3D is quite useless, it is cool looking. To have the same experience but when you switch workspaces would be nice. As well as "expose" kind of function etc.
deskspace and cubedesktop are two apps that tries to do this.