Any ideas on where this would be useful?

I pressed triangle on the first frame of entering the water. As I bobbed back up I was transforming while doing so.

I think this works because you can use the muck monster ability at the surface of water, regardless of your vertical speed.

Holy Damn, this is insane!! This should definitely be useful some where because you can also glide while falling way above the map. For Any% No MTD this has really good potential. Maybe even for Any%.

Any% No MTD would definitely use this somewhere. For 100% I don't think I would repeatedly try for the trick. I imagine we'd have a backup route in case it happens (and we'd try once upon entering the water anyway, like i did in the video). For Any%, no. The token in Hut, Hut, Hike! is very fast. That route is solid and is just a boss rush outside of duping. If you're talking about using it in Peacock Purgatory, I don't think it would work. We need to be able to glide out of it to be the horizontal distance to reach the end of the level. Getting the glide ability is right near the end of that level anyway.