dahuman, terminators do exist!! Watch your mouth. Next thing you tell me the Easter bunny isn't real.
edit* also I said "in the Terminator 'movies' note the movies part.
You kind of missed my point though. The point of games is to make you feel like something is real. When you drive in Grand Turismo, it isn't real, with a steering wheel it feels "mostly" real. Shooters don't feel real but you can get into it. Rock Band? Not really playing the song but it feels like it. The demo from Peter M. was a step forward in real feeling interactivity. Imagine an RPG where you interact with NPCs that way! Who cares if you are interacting with a script, that's not what is important. Why am I wacky or crazy for bringing this up?
Second, I'm well aware of this technology. I watch the science channel for frick sake. I've seen the exact same kind of face and voice recognition A.I. done on those shows. That said it was just much more impressive on the NATAL with the 3D movement detection. Right down to the reaching into the water and seeing your reflection... it was more showy and in that manner more thought provoking that seeing some wireframe graphical face that looks like Max Headroom "interact" with the MIT geeks programming it. Maybe it was all flash and mirrors but the overall result was more emotional and awing IMO. Its also never been implemented so fully into an already existing hardware platform.
I'm just looking down the line, that's all. I imagine this type of tech mixed with true 3D visuals that immerse you in the graphics. If you mix in some kind of tactile virtual gloves that convey pressure when an item is touched, while not totally realistic you could come away with some doable console VR. But I guess I'm just being wacky. I guess could just dismiss the whole thing in the interest of being skeptical.