Is it true a computer case made completely out of plexi glass would be better for heat decipation?

It would be worse.
Plexiglass does not conduct heat as well as an aluminum Chassis would, therefore it would heat up faster. Plexi cases also have the horrible ability to show EVERY scratch.

Haha Chaosratt has a point about the scratches. I made a plexiglass wit a Pine bottom, and even though the scratches were there from before (I used previously used plexiglass), they still look kinda bad. But I dont care about that. Im just happy with teh results. As for heat, I have a 80mm, and a 120mm fan, plus the powersupply fan so heat is no worry for me.

And don't forget that cases are made of metal for a reason. I don't suggest using anything else, unless you plan on not having any kids.