Yup, not a huge fan of this - at least, not intentionally. I do find that in the "flex" spots, there are positions whose value get overlooked because owners categorize players by position - not by lineup. Here is a generalization of what I do with flex spots.
I do a traditional board, separating each position. Then I do another board combining the positions that can be started in the flex position. During the draft when looking at the combined rankings, if a player can be played in two of your OPEN lineup spots, he would take precedent over a player that could only be played in one roster spot. In other words in your league, there may be more value in drafting a Witten rather than P. Rivers because Witten can play in TE or flex and Rivers can only play in QB.
Now, there are two quirks to this. First of all, in your combined list, WRs are typically going to be far more productive than even the best TEs. Which means you will probably fill at least one WR spot before you see the value of taking a TE. The second is that once you draft a TE, now that lineup spot is filled - so you won't draft for your flex spot typically until all your other positions (except K and DEF, of course) are filled.
So, I guess what I'm saying is that I wouldn't be opposed to having two premier TEs if it played out that way, but I don't really envision a scenario where that would be in your best interest. If a RB3 is more productive than a TE2 and you can play either in the flex, why would you draft the one that is less productive?
Interesting scenario, though. I enjoyed thinking this one through.