I know a guy that's got a ps controller that he uses to play his enhance shaman. I think he has the R1, R2, L1, and L2 as modifier keys along with R1 & R2 , L1 & L2, L1 & R1, L2 & R2.... blah blah blah.. He's got pretty much 44 ish different keys assigned to the triangle, circle, square and X keys alone with modifiers... that's pretty much a whole keyboard.
While neat, the person in the video doesn't change targets, and is just pewpewing a target dummy. Show me them healing 25-man Madness, and I'll be impressed.
Also, while you can plug a keyboard into a 360, it can only be used for chat - you can't control a game with them without an extra adapter. A mouse doesn't work at all (to my knowledge).
I totally agree, that this would not be acceptable for any other roll but dps. I'm pretty sure for target aquisition he has some stuff set up like like tab target and assist for most of his stuff. It was the hardest part for me to understand how it would work out.. but hey he's in the top guild on our server and his dps speaks for itself.. i guess if you look up playing wow with a controller it's not that uncommon. He does not pvp.