Nice idea but there is also sacrifice of the relativity of the places. Based on the calculations, looks like the order of the words are important too.
"With 40,000 dictionary words, you have 64 trillion combinations, and there are 57 trillion squares."
If the dictionary words can be doubled, the order of the words can be made unimportant too. That way it would have ~80 Trillion combinations (64 Trillion/3!) * 2^3.