No screenshot, for those who were hoping for something funny.

It doesn't do anything aside from not make confetti come out of your nose like normal and reduces how much is in your inventory anyways.

If you are lying on the ground, you can still use confetti, but it doesn't work.
I could be mistaken, but I also think that when I tried, it used three of my confetti instead of one.

Maybe we can have the "use" button disappear when we are dead, or have it animate in a hilarious/silly way, or even trigger when we get up?

(I need to remember in the future not to post bug reports, or anything else for that matter, after reading Jim-Dale threads. All of my language skills have Jim-Daled.)