It is an interesting concept for sure but we will need to see how well it is executed over time. My gut reaction is that it is more of a blip than a paradigm shift.

I get the space/cost issues mentioned but I think it really breaks down to the demographics of buyers.

We have the unlimited funds/unlimited space group, I'm sure they will buy one just because they can. If the pin ends up as a blip then they will fall into the "collector" category down the road so a few folks will stash one away just because they can. It is fueled by "want" not by "need" (There is a subset to this group that has self imposed limits on space and funds. I'm one that could spend more than I do or could expand my space to include more pins but I'm happy with the balance to my other interests and I know there are others out there who do the same ... other than the interesting tech I don't see this as a pin quickly accepted by that group because we don't "need/want" anything being offered).

Then there are those who have limited space but unlimited funds, I question how that group will accept the concept, if it isn't a "mainstream" product it becomes less desirable so the time it takes for acceptance becomes a big factor. There will be the early adopters who "need" what the pin offers but the average buyer needs to accept it quickly or as time passes it will become less desirable to the masses.

Finally the limited funds AND limited space group where there is generally a need to sell one to make room while funding the next and even with lower priced inserts it may be an issue ...as people have pointed out selling the inserts will be a limited market for a while and getting "stuck" with unpopular games could be a deterrent, just like it is with full-sized pins. So many in that group will stick owning the older pins and that keeps the status quo.

Look at Stern's "The Pin" generally seen as a total failure because it wasn't really what the collector/player market wanted. It turns out we will spend more for a real arcade machine, we don't want a "toy" toy we want a "real" toy. So if the swap-able pin is not seen as a "toy version" and is accepted by OPs then it stands a really good chance but if the focus is the home market and only that market accepts it then it will be an temporary addition to the marketplace not a replacement (and becomes a blip)

I had the chance to hear the Multimorphic presentation at TPF and then play a game on Lexy, as a result I am very impressed. The tech and features are outstanding and I thought that Lexy game play was very good, the interactive playfield was certainly unique. I see real promise in the redemption arena with Cannon Lagoon.
As far as making a purchase, the price point is high but not a deal breaker, tech is cool and currently the game play is good but in the end the video game aspect left me missing the traditional playfield experience so at this point I don't see one in my game room.