It's possible that 'flat-out illegal' is too strong of a statement, although upon reflection I'll still stand by 'almost certainly illegal'. Here's a law review paper with lots of background and references:

The TiVo Question: Does Skipping Commercials Violate Copyright Law? http://papers.ssrn.com/sol3/papers.cfm?abstract_id=901062

Please don't mistake my opinion here on what the law is for my feelings on what the law should be. It sounds like a great app. I'd be very happy to proven wrong, and to find that the copyright law regarding such matters is more user friendly than I've been led to believe.