I did see Local H live -- he had a pedalboard where the E and A strings went through an octave pedal to cop the bass sounds for the band. It worked and sounded like it was supposed to. But very limiting from a songwriting standpoint. Without the octave pedal it wouldn't sound special at all.Local H, if I remember right. No idea how well it worked, I never heard them live and in the studio a good producer could make anything sound huge.
In the studio they just overdubbed with a real bass guitar. I think his whole rationale behind the guitar as bass thing was to save money while touring.
Local H was incredibly loud in this little club (old Peabody's in the flats for you Cleveland Ohio types!) and as I forgot earplugs I left about six songs in.