Two items that ought to be of interest to this group:
1. About a week ago (or possibly earlier, during the WSC?), Prof. Gerard Huet has released his wonderful Sanskrit Heritage website, including all the source code, so that it can be run offline (on any Unix-like system, such as Linux or Mac OS X). The manual at
http://sanskrit.inria.fr/manual.html includes download and install instructions. Unfortunately the setup seems a bit involved, and my system is currently is a slightly odd state, so I have not made it to the end of the instructions yet, but it is great that such a useful tool is now available to be used offline.
2. I just now ran across
http://nodictionaries.com/ which has Latin texts, with word definitions. You can drag a slider to vary the number of words for which definitions are given (e.g. for all words, or for only the most difficult words); it also lets you add notes to a word and see notes by other users/readers. More importantly, it even lets you add your own texts and see similar annotations (word definitions) for them. There is a description/walkthrough here:
http://bestlatin.blogspot.com/2009/06/nodictionariescom.html AFAICT this builds on Perseus in having the definition available without a click (and is made by a Tufts student too).
It would be wonderful to have something similar for Sanskrit. Let us continue to work towards it!
-Shreevatsa