I'm playing a tour right now using Kontakt 2 and a Mac laptop as my only sound source. I keep
a Roland XV-5080 in the rack as an emergency backup, but haven't needed to use it yet.
Over the last couple years I've been gradually shifting over from racks of hardware to Kontakt 2. What's nice about Kontakt is that I can use the latest and greatest sample libraries. I'm using some Vienna Symphonic, some Kirk Hunter Emerald, plus my favorite sounds from my older Akai/Roland/Emu libs. The other cool thing about Kontakt is that it imports Giga libraries, so those are available as well.
I think the key to using a laptop and softsamplers/synths is to make sure your laptop is set up really well for that. You have to really troubleshoot everything in advance. The other key is to have a very reliable firewire sound card and fast (7200rpm is fine) hard disk. I've also found it vital to turn off any networking including any wireless internet reception like airport.
As far as the googoo dolls, he could have had that controller midi-ed to pretty much anything. In that situation, in a stadium outdoors, I personally might use a hardware box for a piano. But you never know, he could have just as easily had a laptop with a virtual piano on it.