There are times when I find hover effects really helpful from a usability perspective. For example, with the right parameters, you can make text preview panes expand to view the entire text panel, and if white space is well used, the hovering doesn't get in the way too much.

This said, and while I realize this is a demo to show what can be done with CSS3, and while it is impressive, it gives me a headache. I wonder how long before we see Pokemon-style photosensitivity-induced seizures from CSS3 in the hands of clueless web devs.