This seems like a reinvention of Coraid's ATAoE, which has the added benefit of already being in the mainline kernel, good server/target support (vblade), hardware products shipping now, a lack of IP/TCP overhead, and a dead-simple protocol.
Routing is also a non-issue since a single drive on the network is about as useful as a single drummer in a marching band, basically you're going to need at least three to make something with a bit of reliability, and more if you want efficient reliability. So between your actual storage 'processor' and the storage 'elements' you drop in a cheap bit of Broadcom silicon to make a 48 port GbE switch and voila, your much more reliable than SATA and much cheaper than FC.
I'm sure tho that the folks at Google are all over this. :-)
The 99% use case of storage access requires no such frills, though.
Since the attachment for an AOE drive is Ethernet, the drive controller is just an Ethernet NIC...