There is no reason it wouldn't work in the same way that there is no reason that there couldn't be a giant teacup orbiting the Earth.
So let me rephrase my question. Given that there are existing, functional devices, based on a similar mechanism, and Remee seems to be an improvement on those devices, why exactly does it qualify as snake oil? Which of my assumptions is wrong?
There is an interesting new iOs app called Dream:on (it's free too) that uses the accelerometer to determine when you are in likely in a REM state, and then it plays audio cues to help get you into a lucid state, instead of flashing lights like the remee.
I haven't had the bed to myself to try it out yet - my wife is a very light sleeper - but in theory both of these devices could work, but don't expect it to happen immediately or every night.. and you may need to incorporate a reality check method too, the device cue would just make it easier to do.