I've seen this sort of desktop tried once before some time ago. It was a DOS program and it had a similar representation of icons and folders. However it's usefulness was lacking. The human interface was all wrong. I mean, great for a flat 2D desktop like Windows 3.0(at that time), but for an dimention tacked on sort of makes your current common input hardware insufficient. I think that the gismos and controls need to evolve along with something of this nature and until something really catches on, you're just gonna have to bea fan or an inthusiast for something like this.

All the same I hope that they keep going as this is not just about some neat idea, but the evolution of the common GUI and pushing the gap between man and machine visual and manual interfacing.