I don't think this is actually hedging at all, but rather allowing loans denominated in other currencies but settled in BTC...
Who decides on the "hedge"? The borrower when creating the listing or the lender when funding?
The loan is still denominated in Bitcoin.
When the listing is activated the aquivalent amount of the loan is calculated using the other currency.
When the payments are made, the amount to be paid in bitcoin is calculated using the current exchange rate (accordingly to MtGox) with the target currency.
http://en.wikipedia.org/wiki/Hedge_(finance)#Categories_of_hedgeable_riskhttp://en.wikipedia.org/wiki/Currency_risk