Hey thanks for sharing this in the other thread, I've upvoted because I love the idea. One of the things that crossed my mind though that I'd like to add is this: Instead of making the toolbar re-appear on scroll up only, perhaps it could also re-appear if you move your mouse cursor to the top of the browser canvas.
That said, I foresee problems with both solutions. For your solution, if you've scrolled down a page a bit and then wish to go to a different website, you need to scroll up to make the bar re-appear. That's probably not a problem, but it does require you to remember the need to scroll up. If I just move my mouse back to the top of the window, as years and years of muscle memory have been ingrained into my very being, I'll be briefly lost looking for where the address bar is.
With my solution, the issue I see is if you've scrolled down a page, but then wish to click on a link that's right at the top of your canvas, and you move your mouse up to the link, the toolbar will re-appear over the top of your link, causing you to have to scroll back up to be able to select the link.
Just some food for thought.