I think you all think it's interesting, and therefore willing to let it fly, but it is a rather generous reading of the rules. As indicated before, it reads the last sentence in such a way that completely overwhelms all the previous ones. The benefit of Ghost Touch then isn't "you can hit ghosts w/ it and vice-versa" but, "holy crap! slice through walls and hit people on the other side, and so on."
When constructing rules or interpreting sentences, one generally does not take one out of context, w/ an "essentially" or similar modifier in front of it, and then use it in a way that is radically different from the previous statements.
Oh, and surely the ghost can take his sword w/ him when he passes through the wall. But, that kind of points out the limits of Ghost Touch as an ability. What happens if someone (somehow ...) disarms him? The sword isn't incorporeal, at least that wouldn't be my call, it would hit the ground. The ghost can pick it up again, even though it's solid, since Ghost Touch weapons kind of count as both simultaneously. That is how I read the ability, not as "it actually turns incorporeal or not at will."
However, I've said my piece on it, we've all at least read the same paragraphs, and god knows I'm not high lord D&D arbiter or anything. So, carry on ...
I haven't even really looked at the build, yet, but I assume it does other cool things than this b/c otherwise it would seem to fall into the item-based build category. I mean, anyone w/ an unarmed strike (or maybe a level of monk, depending on the wording) would have access to the same abilities.