I think the point is that when windows are placed "arbitrarily" placed on a 2D plane, it's less simple to navigate them than when they're on a 1D continuum. With the 1D arrangement, all you have to do is flick back and forth. In a 2D arrangement, there's no "natural" way of navigating between windows which is both simple to conduct, and represented visually. Exposé comes close, but the windows can be too small to properly see what's in them if you have several similar windows open and moreover the positioning of them is arbitrarily decided by the software, meaning users get a very limited mental construct of where each window is spatially positioned (as this changes each time), which would aid with navigation.
Having the clutter of bits and pieces of window sticking out from behind each other is a very minor annoyance, but it is not the crux of the matter in this video, which is the natural flow of navigating between them.
I hope my point is clear? It's a difficult concept to explain.
EDIT: I'm not saying the 1D system is perfect, or even better, but it certainly has some advantages over a 2D system, as well as disadvantages. But I think with some further development, including the addition of multiple continua or something of the like, it could be a winner
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