Great points, I appreciate the feedback. And I have many thoughts on the matter :) As do many others (e.g. http://www.codinghorror.com/blog/2008/03/revisiting-keyboard-vs-the-mouse-pt-1.html).
Speaking from personal experience, hitting two keys in quick succession is FAR faster than mousing (moving my hand to the mouse, then moving the mouse, then homing in on where I want to hover, then letting the hover sub-menu appear, then moving to the sub-menu item, then clicking). Pretty sure the hotkey method would win any race :)
As for the second "problem," just use your tab keys. The intro video mentions that the hotkeys are disabled whenever your cursor is inside a "typing" field (e.g. textareas, inputs) - just use your tab key to move in or out of your inputs/textareas and the hotkey functionality automatically toggles on and off.
Definitely let me know if you have any further questions or concerns - the feedback is great. I put a lot of time into planning and implementing this plugin, and I find it works GREAT for me when developing new sites. Would love to know how it works for others like yourself too.