OK, that makes sense. This explains the use of non-standard tags, too. Progressive enhancement and using a standard DOCTYPE aren't a big issue for apps.
That said, it does play nicely inside browser-based apps, and should work alongside jQuery and other browser-centric libraries. That's something that may get explored later, but downloadable apps are definitely Jo's focus from an architectural standpoint. Thanks for your feedback, by the way.
One more point: I would recommend building on top of the YUI 3 core instead of re-inventing it, unless you can point to something that you think they flat out did wrong. YUI 3 core is pretty small. The YUI team learned a lot from YUI 2 :)
I'm a Yahoo! webdev alum, and I have most of the original YUI team on my buddy list. I've paid a lot of attention to YUI3, and have some differing opinions in our approaches; probably enough to warrant a blog post... thanks for the topic idea. :)