Earlier quoted context omitted.
you're right, but local bash in the browser is technically not possible for now. (if you don't hack or bridge the chrome). It can be an emulator or a connector like the secure-shell app by Google in Chrome store. Terminal app provides a free and full terminal with Koding VM.
ChromeOS has something, but I have a feeling that's the browser acting as a window manager and running the terminal from its underlying Linux OS. I do wonder what might be achievable with PNaCl... Not saying what you've done ain't cool! Just wasn't quite what I expected from the headline :)
if you want to dig deeper (grep for terminal_private_api here):
http://git.chromium.org/gitweb/?p=git/chromium.git;a=commitd...