Very nice build! Also a really nice video of it! (The music was...interesting 
)
I have a similar method used here: http://www.arduino.cc/cgi-bin/yabb2/YaBB.pl?num=1256090448. Old code though, that is (finally) better now. Also this is not a finished project, it was just a test for another project not using any 8x8 matrices at all.
In fact I took this up again yesterday with the intent to finally make it a more permanent system (boxing it eventually), and also improve on it slightly. I don't have common cathode matrices anymore, so I modified it for common anode matrices, and swapped the 74HC138 for a 74HC238, among other things. Also having 16 buttons via 74HC165 PISOs. Basically I just want to make a dual 8x8 matrix display thing to play with programming it mainly.