I don't know if it's ever been done anywhere else, but the radial menu interface you depict at 1:06 was implemented, pretty much exactly as it looks here, on the tragically short-lived Tapwave Zodiac, way back in 2003. This contraption was conceived as a hybrid PDA, games console and multimedia system, and it was a thing of beauty.
It ran a highly customised fork of the Palm 5 operating system, pretty well back-compatible with applications written for standard Palm PDAs, with a traditional Palm-style stylus and touchscreen (An old-style resistive touchscreen, that is, so the stylus was actually reliable, fast and accurate. I miss those) for handwriting input using the Graffiti system and other PDA-like operations, but it also had a left analogue thumbstick and right gamepad buttons either side of the screen in landscape mode, shoulder buttons, two SD card slots, stereo speakers, 128mb RAM, and ATI hardware graphics acceleration.
Why am I mentioning this here? Because, in their fork of Palm 5, some conscientious engineer who surely thinks the same way you do had clearly taken a long, hard look at the Zodiac's controls, and then expressly designed an OS user interface around them, most specifically the joystick. There was a hierarchical radial interface that functioned almost identically to what you've got in your video here, and it elegantly combined both subfolder navigation and action buttons into its radial lobes; you used the thumb-stick to move around the ring of blob icons, not entirely unlike playing the game Tempest. If I remember correctly (it's been a while, I accidentally smashed my beloved Zodiac in an accident years ago), moving the stick outwards from its centred position to a subfolder blob would open that subfolder out into the ring; moving it to a program/action icon and clicking the joystick once would launch it (no double-clicking; I'm sure you'd approve), clicking the joystick in the centre neutral position would back up into the root folder/menu. It was clean, elegant, intuitive, didn't require colossal precision, didn't really give you opportunity to make any mistakes, and you'd better believe it was lightning fast. It was also back-compatible for those who didn't favour the joystick; you could click on the radial blobs just like normal touchscreen icons with the stylus, and they were the right size and separation from each other, surely deliberately, that you could even do it with just a pudgy finger, if you just had no class at all, but the joystick was by far the best, in my experience.
So, what happened? Well, there were some utter bonehead launch decisions (or possibly just sheer, run-out-of-time-and-money desperation) made elsewhere in the company. After lovingly creating this wonderful games platform, I think they had a grand total of three release titles; two of which were ports of Tomb Raider 1 and Duke Nukem 3D, ancient games everyone had already long played to death, and Spyhunter, a bare-bones racing-shooting game that got boring after one level. The stock multimedia player was also crippleware, and rigged to only play a proprietary video format that basically doesn't exist any more and required you to shell-out for the windows-only PC software to pre-convert your videos before you could play them on the device. Furthermore, even though the ATI graphics chip could do hardware video decoding, there was no software capable of actually using this properly at launch. In other words, the launch software line-up comprehensively failed to show anyone what the device was truly capable of. The open-source community raced to fill the gap with TCPMP and a native port of ScummVM, but it all came too late. I believe the device even had a product placement as a prop in the Stargate TV series, but even that was in vain.
Maybe it never stood a chance anyway, because even though the Zodiac and the PSP were announced simultaneously and Tapwave then beat Sony to market by just over a whole year, as soon as the PSP shipped, it just buried them. I still miss mine. It was a lovely machine.
