Interesting idea. Now first thing that wasn't obvious/bugged me was how the item selection buttons REALLY seem to blend into the world, and at first I was trying to understand why they did nothing.
Second issue, is you can place things, when clicking on tool buttons and play button. Also when I pick a splitter, I can only place one, after which the selection seems to reset, which is annoying.
Lastly, but not least, I got stuck on level 2. I think I built what the game wants, but it just doesn't want to accept it. I think you really need is some kind of visual verification screen like there is in many Zachtronics games.