We have an account with a system like this. We didn't put it in but we maintain it. The guy has 3 geo's, one does radiant floor heat and the other two are ducted like this. The whole house is done in a neo-modern industrial design and he has metal panels hanging from the ceiling with small gaps in them. The small gaps are part of the overall design but it allows for no registers to be seen. The whole house is a little weird looking and it's a pain to work on but the distribution system seems to work well.
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So all the air flows up through a 1" gap and all the crayons and legos flow down though it?
I've worked in one house that had a similar system, except there were no ducts. It was constructed very similar to a server room, with an elevated floor pressurized underneath with a 1" gap in the baseboard. Had nice heated floors, but it could be an IAQ nightmare, along with a fire hazard.