Any 3D TV can do this btw. Its all in the glasses...Sonys glasses close both lenses at the same time, every odd frame.
Glasses Shutter sequence for this is as follows.
Player 1: Frame 1 - both eyes open; frame 2 - both eyes closed; frame 3 - both eyes open...etc
Player 2: Frame 1 - both eyes closed; frame 2 - both eyes open; frame 3 - both eyes closed...etc
And yes...4 player split screen done like this could support 8 different players.
I am fairly certain that within 6 months some other company will release a device which combines 2 signals in to 1 3D signal and works with any 3D TV using a new pair of shutter glasses.
As menioned above, it already has ghosting. Trying to make 8-player splitscreen in this is impossible as far as actually getting a useable picture.
I wouldn't expect any more from this monitor for 499 from Sony...even 2 player probably looks pretty bad considering the ghosting and resolution drop. However something like a 3D projector has 0 ghosting and is fully capable of doing this.
All we need now is for someone (VIP or Optoma im looking at you guys) to make a 3D converter box which takes 2 different 2D inputs at 60hz and combines it in to a signle shuttering 120 hz signal, and syncs it with its own custom double shuttering glasses...and taa daa! 2 xbox 360s + 2 Halo Reach games = 2 players playing on same screen ad full resolution.
VIP has been up to lots of crazy 3D shit...I expect them to have something like this already in the works. http://www.3d-vip.com/
I know the website is shady but these guys are the real deal. Way smarter than Sony, Samsung and rest of the clowns who made up the 3D HDMI 1.4 spec...