sorry if i'm such a noob, but how is this different from hybrid power or the 9400/9600gt from the mac books?
i've never used any of them so i really don't know how they actually work.

I really don't think that putting a discrete gpu switching option is the real story here. The Atom chip might be weak now, but Intel's road map points out that the future of the chip is actually very bright. a cluster of these chips can outperform the bigger general purpose brethren core CPU. making this option available now will test the product now in the market and possibly future proof the technology.

It better be windows XP or Linix/Unix ready. Otherwise it won't work.

they gotta get part of those monopoly profits somehow. Screw making chipsets.

Actually, this is a good idea and one that has been sought out for CPUs as well. "Low power" states for CPUs usually just involve reducing the frequency and reducing the voltage as well. There are also other strategies such as power gating that can help as well, but you're still a high powered, large leaky processor. It's chugging away like a car left to warm up in the driveway. What'd be better is to switch over to an entirely lower powered processor that isn't designed to offer great performance, but is actually designed for low-power. This can mean there is no predictive analysis front-end, out-of-order instructions, etc. that higher performance processors use. For GPUs this might mean there is no support for processing instructions, or stream units or other kinds of higher-end hardware that isn't needed to render a simple desktop. The simpler design means that power can be saved without need for frequency and voltage scaling, which has its limits.

Instead of spending all these resources on an elaborate system to switch between two different GPUs, why don't they just build a proper GPU with multiple power states, like mobile CPUs have been doing for years? I don't see any laptops offering an Atom CPU for when you're on the desktop and a Core CPU for when you're gaming.

Just build a GPU that doesn't burn dozens of watts when I'm not playing the latest WWII simulator.