BezelHUD is a Quicksilver Interface originally created by Julius Eckert.
The current version is 1.3. It plays well with Lion as well as the the newest versions of QuickSilver.
The background blurring can be turned of by clicking “Customize” in Quicksilver’s appearance preferences.
Also, if you’re interested, check out the source. Please report any bugs on GitHub or Twitter (@bencochran).