Hybrids are made for stop & go traffic. That's when the electric motor is engaged, as it's the time your engine is using the most fuel. I took a Prius overnight to check it out once. Got caught in very heavy Houston traffic the next morning. Not once did the gas engine take over. During fast highway cruising is when the gas motor comes on. I don't think I actually used any gas at all once I got on the freeway.
Displacement on demand has been around for a long time. There are vehicles that use it right now. Those new Dodge "hemi's" (hemi label, made by Mercedes) use it. The Dodge Magnum R/T (the reincarnation of the station wagon) uses on. Cruise on 4 cylinders, floor it & all 8 come up. The costs of the engine will outweigh the gas savings until your 1000th or so fill up.
I remember watching a news report in the 70's where a guy patented a new carburator. He took a '74 Ford LTD with 1 gallon of gas in an external tank and drove it from Dallas to St. Louis. You never heard about him again, some oil or car company bought the rights to it and buried it. The technology is out there, the big companies are just not ready to let you have access to it.
I gotta call shennanigans. It sounds an awful lot like the rhetoric that comes from people who believe in Free Energy Supression. I do however, love reading about garage inventors violating the laws of phsyics, just to be silenced by "the man".