The problem with it being just "Windowed Mode" is exactly that. It's just one more window to contend with. As with the previous versions, the "Playing Now" display window is even less convenient in my opinion, because if you want to watch a video you are playing or see the cover art of a album or file you are playing, you have to be in "Playing Now" to see it, or have it in "Windowed Mode" which, again, gives you just one more window to contend with.
In it's current state, the display window is imperfect. However, the idea and the placement of the "Display Window" can, in my opinion, only serve to better the MC experience. I can't even begin to count how many times I've wished the display was visible when browsing pictures, videos, and listening to albums. Without the need of having to run an extra window, or navigate to the "Image" selection of the "File Properties".
I don't know, maybe I'm just babbling. But it all makes perfect sense to me. I'm all for it. If anything, make it an option before getting rid of it completely. This is one feature I've been dying to see in MC for at least the past 3 years.