bitcoinity shows market depth, so do a bunch of others.
However there's nothing new about lots of low bids or high asks -- you often find market depth is high high at 0.0001 and 1,000,000.
Bear in mind also that there will be some skewage these days too, as Mt Goxis changing the order process, and only allowing orders to go through that are funded. This will change the profile of the market depth chart, particularly if they just cancel orders that are non-funded but leave the others in.
you got that wrong. Currently no unfunded orders are displayed in the book, only funded orders.
That's apparently (as stated by magicaltux) why the engine craps out: it has to re-check the orders (change the state between "invalid" and "open") when users balance changes.
The depth chart will not change at the time of rollout of the change.
However: it will behave differently from there-on out: When price move (for example) up, some people's USD balances increase. If they have "invalid" unfunded orders, some of these will become valid and suddenly show in the order book. Some other people gain BTC so some of their unfunded asks will become valid and suddenly show in the orderbook. In other words: a price move currently results in depth being moved "uphill" (at least partially).
This will not be the case any more and price moves will just decrease the depth.