I have briefly toyed with something similar. Unlike yours, it has a (very simple and rudimentary) interface, but no sophisticated algorithms inside :) – just a standard LCS diff library. It also works in real time (but is awfully slow).
It can be seen at http://wikiblame.heroku.com/ (source at https://github.com/MatmaRex/wikiblame) – there's some weird bug right now that makes it fail for titles with non-ASCII characters that I haven't had time to investigate, and due to free platform limitations it'll fail if generation of the blame map would takes over 30 seconds (that would be for most articles > 3 kB or with more than 50 revisions); I was intending to move it to some toolserver or labs or something, but haven't had time for this either.
I've also seen some gadget on en.wiki that did something similar, but I don't remember the name and can't find it right now.