Thanks Gussie Fink-Nottle,
I have a late-2009 27" iMac and have use a regular mini-DisplayPort Cable to connect a MacBook and MacBook Pro fine. In the documentation, I've read that you need both computers to be awake and the iMac did magically become an external monitor while it continued to run in the background. (All 8 logical cores at 100% Folding@Home).
My question is: Have you tried to connect both computers while awake and it simply didn't work, being the only difference between mine and your setup is that I was using a MacBook and MBP with a DisplayPort instead of a ThunderBolt? (I take it the answer yes? You have tried?)
I have a feeling that if you got it to work by only those exact steps, including the cable be connected before booting either Mac, then the technology obviously works and some software and/or firmware updates may resolve this strange setup requirement / issue.
I'm glad to hear that a regular Mini-DisplayPort cable works in this case, because I have a few. I have had trouble finding any information about needing a Thunderbolt to Mini-DisplayPort Cable. I guess there is no such thing? A suppose a ThunderBolt cable, and a Mini-DisplayPort cable are two different things. A ThunderBolt cable will work on Mini-DisplayPorts, but Mini-DisplayPort cable won't work on both Thunderbolt ports? (meaning one ThunderBolt Port would be a hard drive, or something other than a display)
Again, I wonder if a "ThunderBolt" cable would work on two plain old Mini-DisplayPorts? (Also, I'm sure vise-versa wouldn't work because ThunderBolt carries power.)