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I saw too many things wrong that I didn't care to post the full correction. Montana covered quite a few points.

I'll just say that the production cost of the camera in Natal is supposedly only about $20, so add in the other hardware and microphone and it seems to be no where near $100-200.

The rest... just realize you have a very narrow minded view on the subject and apparently can only see one outcome where many exist. These new controls are not meant to "destroy the wii", but they will take some interest of casuals and take some selling impact from the Wii.

Oh, and MS stated with Natal that they are targeting the 60% of households that still do not own any console. They are targeting people who don't even own a Wii because they don't like the idea of a controller at all. I've seen people play with Wii-remotes and suck, so if you really think these kinds of people don't exist, well that is another facet to your narrow minded view.