It could mean that you can download your tablet or phone game and play it full screen on your TV using your Tablet or phone as the input device.  It could also mean for those tablet devices that have keywords you can plug into will work just as well.  Also MS might bring out their next gen tablet with physical controls.  Another interesting thing is Win 8.1 supporting Miracast.  Miracast would allow you to stream your game video from your PC to your X1 which would be interesting if MS did this.

Last but not least, Keboard and mouse control for those die hard PC gamers.

At first, possibly.  As a second screen, you'd also likely have the game running on the tablet or smartphone too, so maybe you'd just be looking at that.

You do realize that there are already games on smartphones and tablets that use touch controls to control games, right?  They're not all swipe games.

I'm not an idiot lol. I understand that the xbox will be running the game, just like how vita remote play will work. I just don't get how a smartphone could be used as a controller to replace an actual controller.

I know and its 10 x easier to work on a moblie device than it is for a console because you are looking at the screen while your playing, it just wouldnt work

Depends on the game, but as an exmaple, Ilo Milo, if it was an Xbox One game, you may have areas on the screen where your thumb postion is resting on "virtual" analog sticks, and as you move them up, down, left, or right, you move the stick.  Face buttons likewise would be a location on the screen. 

Alternatively, a game could re-map for Smartglass.  So, running from the Xbox One, it uses the controller.  However, operating through Smartglass it becomes a swipe-based game.  With Ilo Milo as an example again, you could drag your finger on Ilo or Milo to where you wanted it to go. 

I don't think I implied it would be for every game, I just said it would be possible.

More options sounds good to me.

Wii U ripoff confirmed :P