Been there done that. This was the same thing touted by the folks at "iCache" who released a few test units of the "Geode" -- an iPhone jacket and universal card combo that could do this as well as provide support for barcodes using an e-ink window on the back of the case.
Unfortunately, the company -- after a successful Kickstarter and infusion of venture cash, crashed and burned. HARD.
As it turns out, there were huge limitations on where this type of "cloned" card could be used -- no ATMs, no "pull through" swipers like at gas pumps... It all fell apart quite noisily with accusations of fraud and deceit on the part of the company's founders.
The bottom line is this: Payment card providers require three things: 1) the card should be signed, 2) the card should be present so the merchant can verify the expiration and CVV (or pay a CNP fee), and 3) the card provider's logo must be visible on the card. Failure to comply with any of the three means a merchant may lose his ability to accept cards to the provider. The Geode could do ONE of those things; the same goes for this card, as technically interesting as it may be.
And of course this goes out the window as NFC or chip-and-pin cards eventually come into fashion in the US (as chip-and-pin already is in Europe).