I think reading this post has jinxed my MBP, not a month out of the box with Lion 10.7.2. Was working just fine until this afternoon. Now I'm trawling the Apple support forums while the machine spins the beachball every time I try to do literally anything in Word. Ack!

Cool! This is fun.

Have you seen a similar kind of thing, ManyCam (http://www.manycam.com/)? The ManyCam driver is less groovy but way more flexible, works with everything (including Skype and Connect) and what's not to love about something that can add googly eyes, any background you like, or a Santa hat, all in real-time? Also free.

A similar thing, which is neat as you can share your desktop via the video driver with your face overlaid on top, is CamTwist (http://camtwist.en.softonic.com/mac. Huge range of combinable and tunable effects that are at least as wild as Camera FX but I've found that's much harder to get it working properly - somethng to do with 32-bit vs 64-bit drivers combined with an interface from the dark ages. Fun in preview though. Also free. If you use it and can make it work, do tell me how!

Although Apple Photo Booth comes with pseudo chroma key FX, the apps that you have found will definitely liven up a video podcast.

The Manycam with Skype is an excellent addition.  The software is stable and highly configurable with the ability to download more elements or create your own.  Wow great stuff!

This is just the pecfret answer for all of us
- Dortha