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these have been made and still sold today
/second writing as the previous was lost in forum maintenance
I remember reading about that design back when they came out. Looking at the way it worked I basically came to the conclusion that it is "bling" for those that just want to say they have a TEC in there system.
The reason for this is the first stage cooling. If the TEC drives the bottom plate below ambient, the heat pipes will be delivering heat from the air to the CPU heat spreader (heat pipes do not care which end is the "hot" end), so you are cooling the cpu and the ambient air (before going through the second set of fins). I assume the electronics in the CPU cooler are designed to not go below ambient (so also offsetting issues with condensation build up when going too cold) so this is not a large issue, but then it means for low temperatures, 1/2 your cooler is doing nothing. Not a issue previously, but given the low idle temps on most current gen CPUs, just a little issue.
Given this design issue, it means people in hot areas or with poor ventilated cases, that type of cooler is properly worse than a standard cooler. As the ambient temp rises in the case, the higher the point the TEC comes on increases and so the hotter the cpu gets before the full cooler is activated. Given the extra heat a TEC generates, this could result in a system where little difference is seen between having the above cooler and having a standard air cooler of similar size.
Of course, if the fans where installed backwards for some reason (customer?), then the issue is made worse as the situation is setup to creating a heat path that will result in far less cpu cooling occurring.