This is a very interesting way of solving the key distribution problem. It forces attackers to capture both the digital part of the key and the physical.
This doesn't solve the key distribution problem at all:
To start off, both Alice and Bob must have their own slabs of diffusing glass and must physically meet to create a key for encoding a message later.
Like any other OTP system, key distribution — ensuring that the parties who wish to communicate securely have a shared secret (or secrets in the case of OTP; the whole point of OTP is that a key is only used once) — is the weak point. Unlike many other OTP systems, this one requires a physical meeting, which, depending on your use-case for needing crypto in the first place, may be impossible, or deadly dangerous.
To start off, both Alice and Bob must have their own slabs of diffusing glass and must physically meet to create a key for encoding a message later.
Like any other OTP system, key distribution — ensuring that the parties who wish to communicate securely have a shared secret (or secrets in the case of OTP; the whole point of OTP is that a key is only used once) — is the weak point. Unlike many other OTP systems, this one requires a physical meeting, which, depending on your use-case for needing crypto in the first place, may be impossible, or deadly dangerous.
At best, this complicates key compromise.
EDIT: clarifying language.