I have a 40g reef tank with a 10g sump, and it works for me. The only complaint I have about it is that I have to top it off every two days...not much room for error.
I have an inlet side where the water enters, flows down under a baffle, up over a baffle and into my refuge...through some macro algae, up over a baffle, under a baffle, and into the pump area. I even have an in-sump skimmer in the refuge area. I have a phosphate reactor on one side as well. It works if you do it right.