First, here's the article for anyone looking:
http://www.sciencemag.org/content/early/2013/04/03/science.1234330.full
semck, "it's not such a surprise that they can do something analogous while you're asleep."
Even if this is nothing novel as far as findings, it is a new application, and finding that the new application works in practice is interesting. One never knows until one tries, yes? So sure, not surprising that it works, but there are still kinks (otherwise, their methodology would produce near 100% accuracy), and future researchers can look at removing those kinks as steps towards viewing dreams like movies (even if that is, ultimately, an impossibility). Lots of things that are impossible have been worked toward in science and the world is better for the myriad discoveries along the way. I wouldn't be so quick to dismiss this study either. Who knows what applications it may have outside the realm of dream interpretation/ translation?
I don't see it in the article (maybe I missed it?), but abge, your assertion that the dream-state has extra noise must be at least partially true since they opted for the NREM dreams rather than the REM dreams. It may be that they chose NREM dreams over REM dreams since it is easier to wake someone from NREM sleep ("We focused on [NREM dreams] ... because it allowed us to collect many observations by repeating awakenings..."). However, they also mention REM periods ("Reports at awakenings in sleep-onset and REM periods share general features..."). Anyway, here's what I found indicating there are differences between the two dreams:
http://www.ncbi.nlm.nih.gov/pmc/articles/PMC2629609/
http://www.sciencedirect.com/science/article/pii/S0361923004000930
and lastly, this article: bit.ly/10AquGF
Basically, NREM is boring stream of information, REM is memory/movie quality stuff.
"I don't think they did it while the people were awake"
Fairly certain they were awake.... "We constructed decoders by training linear support vector machines (SVM) (20) on fMRI data measured while each subject viewed web images for each base synset." Viewing material requires eyes to be open, which does not occur during NREM sleep.
Didn't follow the other links yet, but I think this topic deserves a bump, if nothing more than for the link to the full article.