While I've experienced the illusion too, not that many speakers can get the height aspect right--Dunlavy/Duntech and big Maggies seem to do it well, the Wilson Watt/Puppies never seemed to do it that well to me. However, while you're correct about what SHOULD constitute three-dimensional sound, I don't think the marketers are really referring to height, but rather to a concept of holographic imaging so that the images in a soundstage appear as more than flat images--a soundstage you feel like you could walk into, perhaps, with three-dimensional rather than flat images of performers within the soundstage. A lot more speakers can do that.