Although everybody is calling it 'a truly geeky idea' and making a bit of fun of it, I'm still going to reply in a serious way.
Depending on where you want to go with your OS, if you're actually going for the ultimate networking experience, this is not such a bad idea. Simply because your windows manager is rendering dhtml pages, you can also switch your desktop with your favorite website. Imagine your second desktop is your browser 24/7. Sounds silly, but then again, you can have F11-modus (I have to call it something...) without limitations. It'll probably speed up a few things too.
Next to that, we're seeing a lot of applications recently getting 'online'. I've seen editors, irc & msn clients, database editors, other basic shell like websiteds etc. This gives operating systems compatability/portability an insane boost (if every browser renders it correctly, but I'm not going to flame about that). In that case, if they main user interface is able to render and use these incredibly lightweight applications at an increased speed (see previous point) it could be a serious app-killer. Pardon the expression.
While typing this more and more ideas pop up in my head, but I'll stuck to these two for now. Does this sounds reasonable?
with some incompatibilities with mozilla
