If GChrome doesn't have dialogs, and relies instead on the popup from the toolbar button ...

How can I switch the popup's contents?
With Ajax I could replace the contents of a div or even the body, but not the scripts or css styles.
I've tried window.location = "popup2.html", which which works as a page, but not a menu popup.

- can I drag the popup around the screen?
- style its background (transparent?), borders, and/or remove the cartoon-balloon pointer?

You'll have to change it with JavaScript (ie. dynamic HTML ). You can use a background page to control what needs to popup if there's no other external data that controls that.
Can't drag the popups. Dunno about making it transparent, I don't think so think that's the default background color.

HappyFunBall - have you tried the experimental.popup namespace?

I need to show an iframe in the popup.html with varying content from a server (a page containing HTML, Scripts, and CSS).
I also need to modify the iframe from JS in popup.html, providing it with variables and functions, so it needs to be local with the same domain/protocol/port as popup.html.

Apparently I can't save new content to the disk which the iframe points to <iframe src="localfile.html" ... />,
I can only change content dynamically with something like jQuery().html(...), but that only changes the DOM, not the CSS or Scripts.

How do I either save a local file, or change the whole iframe contents (HTML + CSS + Scripts)?
Maybe I can point the iframe to something other than a localfile (Storage or ApplicationCache)?