I read somewhere that MS recently demonstrated that their 'Longhorn' OS could display video anywhere and then showed a video playing in a tooltip. Ignoring the uselessness of that specific example, I realized that you can actually display video in tooltips in Mozilla already. Here is a screenshot. (I would give an example but I'd need a suitable freely usable video - for the screenshot, I used a RealPlayer file from cbs.com.
Here is the related XUL:
<tooltip id="tooltip" orient="vertical" style="padding: 1em;"> <label value="This is a tooltip"/> <separator/> <html:embed src="..."/><!-- or use html:object --> </tooltip> <button label="Hover here to see a really funky tooltip" tooltip="tooltip"/>
It's not perfect of course, since plugins tend to do what they feel like and you don't always have control over how they play. Mozilla would need to implement SMIL to handle it properly.