The innovation here is that that nobody can make a copy of the piece of glass.
Or is it...? If Bob can create a OTP using the glass then so can Eve. All she does is sneak into his hotel room when he's asleep, generate his pad using his crystal and make a copy of it.
The point is that its a READ ONCE device -- Eve can't make a copy of the data in Bob's key without destroying the physical device containing the key...