The thing is, with old Palms there was a graffiti area. On that graffiti area were the "home" and "menu" buttons, amongst others, as well as the ability to enter data.
On the T3, you don't necessarily have the graffiti area, in which case the status bar is there to provide instant access to certain essential functions. (OS 5 gives you the ability to enter data without the graffiti area being open). Are you saying every time you wanted to access the menu, exit a program, or enter data, you would want to press a key to reveal the status bar and then click on the relevant funtion; instead of being able to access the funtion straight off? I wouldn't. I'm sure also that once you tried it, you wouldn't. I can understand your thoughts on this, but once you've tried it you'll realise it's essential and useful.
Incidentaly when the slider is shut, the screen area is 350x320, so you have access to the original 320x320 screen, with the status bar extra on the bottom.
As for how, I'll give you an example. I enter Splash Photo. I press on a photo. It appears fullscreen (i.e. the status bar has dissapeared.) Another example, I play a movie in MMPlayer. Upon entry to full screen mode, the status bar disappears. Upon exit of fullscreen, status bar reappears.
Hope that helps.