Has anybody seen somebody do this? Play guitar for 12 bars, capture a loop, then spend most of the song blowing harp and singing? This is the first thing I've seen that makes me want to loop.
This kind of thing is fairly common in the looping world. Perhaps if you specify just the use of harmonica over a loop like this, then it isn't super duper common, but this kind of thing is done all the time. It really isn't particularly spectacular from a looping artists point of view. Not bad. Just nothing all that great.
I do this sort of thing routinely, as I am a singing guitarist and have been using digital technology to extend a live performance longer than I have been playing harmonica onstage! It's how I play chromatic, but also diatonic sometimes. I will also play rack harp and guitar, it all depends on what the task is. Sometimes I use a laptop to play MIDI files and put my part in live--it's all good! Gear: I like the Echoplex Digital Pro, long discontinued, but usually go out with the Boomerang III and a Digitech Jamman (the original, not to say the original Jamman, that was made by Lexicon--here's a page on it--I had one but sold it to buy an EDP).
I also use the looper in my VoiceLive Touch, that's what Brendan Power uses for looping, that my choice for looping the harp since the other two don't have the mike going thru them--that makes it easy to grab the audio from the guitar while singing or playing harp.