Both buttons do work with a few apps on the primary having focus but most either consume the click or loose it.
Primary is XPpro, secondary VistaPremium32
Apps that pass the click to the secondary:
Windows desktop (everything minimized)
Opera
IE6
Apps that consume clicks instead of passing them to the secondary:
OE
Explorer
word07
Apps that eat 4/5th button clicks but are unable to use them:
Mirc
boinc manager
winamp
task manager
calculator
Notepad
Apps that keep 4/5th button clicks from being passed to the secondary but don't use them (although they do when they should be recieving the input)
Firefox
This isn't a scientific survey, since with the exception of IE/FF the lists consist of the applications I had open while posting this.