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shams said:
Its pretty cool :)

No - its not 3D, its completely different from 3D tech. Its simply using the camera to simulate a motion controller (i.e. tilt/Wiimote) - and then uses the angle of the DS to change what is rendered.

The iPhone could do this really easily (without the camera) - but its nice to see the DSi do it. Very cool.

No, sorry.  That doesn't take the person's position into consideration.  If I'm laying down and I have the DS above me, that should show the same thing as sitting and having the DS horizontally in front of me.  You can't do that with just the angle of the DS (or tilt on a Wiimote).  What's critical here is the angle between the viewer and the DS.  You can only calculate that if you know the position of the viewer, and that requires a camera.  Just because it's not stereoscopic doesn't make it not 3D.  Stereoscopy uses 2 images to create the sensation of depth.  This is using rotation to create the same sensation.  It's a 3D image/room (in the sense of SM64 3D) no matter what you think, though.  In order for the screen to show it correctly, it has to be able to rotate it like it's a 3D environment.