Pretty cool. I hope all goes well for the author.

But I can't help feeling that generating normal maps from full 3D models would be more robust overall.

For instance you could easily make things like a walking animation or calculate ambient occlusion (pretty standard 3ds max work.) Render it into a sprite sheet and you have the pipeline to dramatically reduce the amount of work artists would have to do.

I guess Sprite Lamp would be best geared toward indies/studios without 3D modelers and can't invest in the aforementioned tech.

This is cool nonetheless.