Hey Babelfisch – these post-processing GLSL shaders are capable of a wide variety of things, including bloom effects like the one shown in your image. I don’t know what people are referring to with the instagram thing, but their fundamental limitation is that they’re applied post rasterization (once the 3D scene has been converted to a 2D image), and so only work on pixel data in 2D space. That’s why we see the changes to the HUD etc. Take a look into the differences between Vertex and Fragment shaders and so on.
I’m working on an arty application using the same tech, and the video below shows the kind of things that I do with it (skip to the 3 min mark), so they're not necessarily "simple". This example actually gives the illusion of depth in places, but it’s just working on pixel data using 2 jpgs as source material. I guess that we can all be thankful that I’m not in charge

:
P.S. I think that they’ve also made changes to the 3D lighting system proper, with better volumetric effects and so on.