An old work colleague of mine is a friend of BumpTop's creators (Anand Agarawala and Ravin Balakrishnan)... they were in the DGP program at UoT together.
You can see some more information on the concept of spatial document management by checking out Microsoft's Data Mountain research here.
I'm of the belief that as interfaces become even more intuitive, the interaction with that interface will need to be altered. If we are to have a 3D, malleable UI that mimics traditional, real-world desktops than the traditional mouse+keyboard simply won't cut it. This technology is serving many purposes, one of which is that it's demonstrating the limitations of our current input device techniques (I mean, come on - unique selecting with ctrl+click isn't exactly intuitive to the uninitiated)... bring together the Nintendo Power Glove and BumpTop and I'll welcome you to the future.
With the push toward 3D desktops on Linux and the recent partnership between Novell and Microsoft, I think it's safe to assume that the desktop experience will go far beyond what BumpTop presented a few months ago... nonetheless, a really great shift in perception of digital userspace.
I would have to agree with you in terms of UI. Users desire GUI's they can almost touch. (My current project is touch panel design/dev), and I want to integrate it with AE and Flash directly, however the companies technology is not quite up to par to support these files.
I don't think we are quite ready to put the Nintendo Gloves in the close future. I think it will take some time for the general computer user to adapt. My approximation is 2016. I will check out the Microsoft Data Moutain research. Thank you for your post, keep in touch - darlin!