I'm the one who started working on client-side decorations for gtk+ originally, just as an experiment (but with encouragement from Kristian Høgsberg). After I quit Canonical I never heard that anyone else had picked up the branch, but every once in awhile I hear something about it when people start talking about Wayland.

Anyway, I was never really worried about the things that you're worried about. xmms proves that anyone who wants to write a shitty, completely custom UI with shitty window decorations is perfectly capable of doing it already. In fact, the gtk+ client-side decorations branch didn't make it easier for someone to do that the way everyone seemed to think it did.