It can be selected at same bounding box DOM node have and the selection will not be highlighted at the moment, but we will fix that.
I've experimented with canvas in the past to see if it could improve the performance of, say, a terminal that updates very quickly but it ultimately ended up being just as slow as the regular DOM because of all the extra code that had to be running in order to keep the hidden buffer in sync with what was displayed to the user.
I'd be curious to know how the performance of WebGL compares to the (accelerated) canvas.