The problem I am having with this scrolling scheme is that when I forget to scroll I find myself reading what I already read (and getting a few words into it before noticing). I can't forget to scroll in the normal scheme since if I don't scroll there is nothing more to read.
Yea, it seems to be confusing and distracting. Maybe it can have some sort of fading effect on the older text to improve readability and awareness as a reader scrolls.