I'm actually starting to wonder how a lot of the Natal based games are really going to work. Genuine curiosity here. It'll have to wait until E3, but right now I'm really thinking a lot of these 1:1 control type games are going to be like pantomime controls. Either that or there's going to be a really big market for plastic prop peripherals to be used as stand ins for in game objects.
Maybe you can use your Wii remote for a sword handle. Or a banana. A bagel or giant soft pretzel could be your steering wheel. Half of the fun of Natal will be finding random household objects to use as controllers.