I mean, can you give a real-world example where this technology has resulted in an increase in user happiness? The only way I could see this being helpful is if you aggregated the data and made inferences across multiple users. But then, you are spying on everyone.

If you are going to use it to engage a single user one-on-one you run the risk of revealing you were spying on them. I, for one, would rather not have to constantly feel like I was hiding something when talking to my users. Users are comfortable with the idea that you can see access logs for page transitions, and use that to help assist them. They are not comfortable with the idea that you can see things they typed and decided to not submit to a server.