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From Wikipedia, this is Oboro Muramasa Yōtōden, and I'm guessing the name will be changed if this is localized (Odin Sphere is apparently called Ōdin Sufia in Japan).

Also from ol' Wiki:

The game is said to have two different methods of control, one for casual players that will presumably involve the Wii Remote, and another for hardcore players who'd prefer a more precise method. Graphically the game is similar to Odin Sphere (another Vanillaware game), retaining the same 2D art style, though inspiration will this time be drawn from Japanese culture rather than Norse mythology.[1]

So far two playable characters have been specified: Momohime (百姫?), a young girl who wears a kimono and wields a katana, and Kisuke (鬼助?), an amnesiac ninja boy. Not much more has been announced about the game, though due to the obvious similarities to Odin Sphere it is presumed to be a spiritual successor.

Just think of the two control scemes as easy and hard mode. 

 



A flashy-first game is awesome when it comes out. A great-first game is awesome forever.

Plus, just for the hell of it: Kelly Brook at the 2008 BAFTAs