I find it quite funny. The author started by demonstrating that sliders are inappropriate when representing 1-of-N choices. I agree. Then he proposed a visual change that makes things better. This change makes the GUI element look like and work like radio buttons. The only step remaining is to stop calling this GUI element sliders and start calling it (fancy) radio buttons.
I see a significant difference between radio buttons and the proposed solution. The change of state with radio buttons require a simple pointing and click. While with the sliding frame, a pointing and a constrained sliding operation is required.
When using a mouse the radio button is the most simple and efficient widget. But when using touch screens, the sliding frame seems a better solution because it avoids accidental state change, while still being a natural and intuitive operation to do with the finger.
So I would say that for touch screen devices (especially phones) the proposed solution is excellent and better than radio buttons.
That's totally a good point. Following this idea, in touchscreen devices there should be only one widget for both radio-button and checkboxes (which can be represented as boolean sliders)
I think the big difference between a slider and radio buttons is how much screen space is taken up. For radio buttons, you have the text description ("ON", "OFF") along with an indicator / selector to the side. Whereas the slider combines these two elements. This is more important on smaller screens, where the text / selection area would have to be enlarged to accommodate finger input.