Be more specific. One presumes you are a Googler. If so, when was the last time you did a 20% project, how much dedicated, blocked off time did it have, and how did it effect your relationship with your manager?
Stuff like 20% time being defunct becomes common knowledge through multiple independent repetitions, like Amazon being a shit place to work, Google not doing customer service or Zynga, well, Zynga.
I recently left Google (about a month ago) but in my roughly 18 months at Google I was always working on 3 or 4 projects of my own choosing outside of my 'day job'. They each took up between 5-15% of my time so I'm happy lumping them all together and saying that they were my 20% time.
One of my non-day job focus areas was security education, I ran several classes/events to try and teach people about writing secure software. A public example I can give is the Hardcode Secure Coding competition which I was one of the organizers and judges. See http://googleonlinesecurity.blogspot.com.au/2013/05/the-resu... (I'm one of the guys in the desk photo).
Another example of my 20% projects was a dashboard that compared the number of security reports that had been reported against various parts of Google. It compared them with a lighthearted metaphor and was displayed in a relatively high traffic area in the hopes that it would draw the interest of people who did not track security issues day to day.
A final example is that I worked a little bit on Glass, but only as an interested outsider. I helped out with some security reviews of internally developed Glassware on a volunteer basis as well as wrote my own Glassware to help test the platform.
Blocked off time varied, Hardcode required a lot of blocked off time (including a trip to Singapore). My other projects generally needed a couple of hours at a time. In an average week I'd work two half days on my side projects (not every project every week).
My managers were both very supportive (and all round great guys), it helped that I could explain the potential benefits of all my projects and that they were not completely unrelated to my day job (performing security assessments and code reviews of non-Google code/systems). There are probably limits to what my managers would endorse, but I never got anywhere near those limits.
I wish people would stop saying this, 20% time is not defunct at Google.