I have come up with a new technique to render area light shadows: Smooth 2.5D Area Light Shadows. I am wondering whether what I came up with is really new, so I hope you guys can tell me whether something similar already exists. Here's a video of what I implemented so far:
[youtube]F_MeY5iBnLc[/youtube]
I have built a little prototype of my technique, but it is far from finished yet. Let me first explain what area light shadows are, since I guess not everyone knows that:

Area light shadows are currently never used in games, because techniques to render them are incredibly slow, so they don't really work for real-time graphics.
The technique I came up with, is not a general solution: it only works for games that are viewed from the top, like Diablo and Torchlight. That is why I call it Smooth 2.5D Area Light Shadows. It is, however, very fast to render, so I think this technique would really be a big addition to these kinds of games.
Here are some results of my work:

The most important thing that is missing right now is working correctly with height. I have a simple solution for that, but I have not implemented that yet. This image shows what I mean:

So, how does my technique actually work? The basic idea is to render shadows to a render-texture from a top-down perspective. So the shadows are kind of similar to a height map:

This means that the main downside of my technique is that there cannot be several layers of shadow above each other:

I hope this explanation of how this technique works is clear enough. Feel free to ask any questions, and obviously I am looking forward to suggestions for improvements!

Anyway, right now my main question is whether this really is something new. Because if it is, then I am going to put a lot of work into the prototype and hope to present it at GDC Europe, so it would be great to know about that beforehand.