Hmmm... You can definitely drop down the voltage, and ideal capacitors don't dissipate any power. So it seems, at first glance, that you could use a capacitor divider as a lossless voltage step-down device for AC.
So you could use a cheaper variable cap divider as a replacement for a Variac? And it would be continuously variable, too, whereas the Variac is only variable in discrete windings.
There has to be something wrong with this. What am I not thinking of?