I also think they might be solving the wrong problem, by concentrating on size, instead of on efficiency and cost. Granted, if you make it small, you may have to make it reasonably efficient, because any waste energy has to be dumped as heat, and small boxes have trouble getting rid of heat without causing damage. But size is much less closely correlated with cost. I think the world needs cheap and efficient inverters more than it needs tiny ones.
I can agree with mikeselectricstuff's logic, as well. It's probably better to figure out how to avoid multiple conversion steps entirely, instead of figuring out how to do the conversions better.
On the other hand, if they do prompt people to solve the problem as they've stated it, even though it's not exactly the problem I would have proposed, it still may stretch the state of the art, and that's not such a bad thing.