I tried this a while back, it's a very interesting idea, but the continuous zooming would probably make me feel queasy after a while.

Also, it's seriously flawed where pen input is concerned - there's no way you'd want to keep the pen on the screen and slide it around constantly, you'd have to maintain constant pressure but not too much otherwise you'll damage the screen. If you're right-handed the pen will often obscure an important part of the screen.