Gonna break this into two posts since its two distinct thoughts....

- My Take on how to achieve 1:1 -

Ben you are partially correct.  The 1:1 motion can be accomplished, the wii-mote is definitely sensitive enough, I think we are in agreement about that much.  But the limitations of someone stepping backwards can be gotten around with good coding.  It just takes some thinking, a great example is rumble + motion sensing, but they were able to compensate for that interference..  

When it boils down to it certain motions don't make sense in the context of sword play and those motions can be isolated and thrown out.  Some simple ways to handle this is to note that when someone steps back there is a pattern to that motion with respect to the arm, but just as importantly there is a velocity related to the motion.  The pattern and velocity of that motion are not going to be very similar to most sword play moves...or at least not any I can think of off the top of my head.  So at that point its a pattern recognition issue.  You would recognize that it is a slow(er) pattern and it has the characteristics of a step backwards based on the overall backwards movement but also the jarring stop focused downward on/towards the Y axis from the foot landing (might seem minor to us, but electronics are nice like that).

Mind you this is probably not even the best way to handle it and I'm sure the folks who come up with this stuff are better at it than I am.  But in my example its not like they are actually coding these things bit by bit they are basically capturing several samples of someone stepping back and finding the general function created as a result.  Then the function can be used with basic pattern recognition software, of which they can choose from a number of different methods, but they don't have to choose right away.  They can figure out what kind of resources they are going to be able to devote to this aspect and return to it later in the project.  The more system resources they can devote obviously the better it will be, and in general I don't think the calculations are all that hard when properly minimized to fit precisely what is needed.  The reason I choose this method as an example is because it is very likely similar to what they are already doing when detecting "good" or "wanted" motions.

But I must say I completely agree that 1:1, while cool, would be a very lame mechanic to be forced to deal with in a game.  I would love it for an optional control style as it would allow players to really take their game to the next level and get very good at blocking the attacks of other players and the like. Just think of how many "star wars kids" we would have running around then =P

But it is technically feasible with the amount of data collected by the wiimote and hopefully nobody questions the precision of the data collected because I have played with the PC tools available for interfacing with the wii-mote and I can tell you the sensitivity is pretty good.  Minor shifts are registered very clearly.

So just to summarize, it is possible from a technical standpoint.  However it is quite difficult from a design standpoint, or at least it is if you want the game to be enjoyable initially by anyone other than those experienced in sword play.  

I don't know how much developement it would take to accomplish and it might very well be cost prohibitive but it is something they could do, given the resources, and the time. 

second part...

- My take on how to do this sort of thing right -

You don't nee don't need to have 1:1 controls for it to be very interactive or very fun, which is why 1:1 is actually very cost prohibitive. Very similar levels of immersion can be obtained from significantly less work.

Slashes - At the basic level slashes are a very easy gesture to understand, but in the context of a shifting body implementing the slashes it gets very difficult as Ben pointed out. A very simple approach to design can be implemented by simply focusing on trying to obtain a high degree of precision in the angle of the swing. From the angle of the swing we can make educated guesses as to the height (relative to the shoulder) the swing is being made from. This type of info is much easier to get than negating movement forwards and backwards and can very accurately simulate the desired sword swing.

Thrusts - I think most people understand how simple this one is at the basic level, but it is actually fairly difficult in terms of determining where the person is attempting to thrust to. The best answer to use here is to assume the screen is the body and let players thrust at screen locations in order to guide the thrust to a certain part of the body.

Blocks - This is, in my opinion, one of the harder areas to do properly, let alone well. And actually I think this is one area where 1:1 is actually a worthwhile investment of time. However within the larger picture of a game development that can still be daunting so there has to be an alternative. The only way I am seeing to do this one currently without 1:1 help is by having people hold the controller out and then press and hold a button. The angle of the wii-mote would be used as the angle of the sword to block and from there it would only respond to Y inputs allowing the block to be raised and lowered. But I still see some issues in detecting the angle properly on this one so I am not 100% happy with it. I will have to give it some more thought.

Force powers and/or magic could/would be gestures obviously and those are pretty straight forward for the most part.

Edit: Just to be clear, I am suggesting that the character in these examples would hold the sword in a preset position until these events specified above are detected which would obviously trigger the related action. So not quite 1:1 but allowing high degrees of precision.

 1up eh?  Hmmm ok you need not say anything more.

 I don't think I've ever played a game system that didn't have a lot of games with horrible control schemes.  I'd go as far to say that there were more PS1 and PS2 games with bad controls then any console before them.  I still loved my PS1 and PS2 despite this issue, I hated the games with bad controls instantly.  I really don't see Dave's point.  If he thinks all anyone cares about is motion controls on the Wii, then he is seriously mistaken.  People love the Wii for ease of use, fun quick games, great blasts from the past and the fact that the system already has a bunch of great games on store shelves that have great control schemes.  Anyone remember playing on the old Atari 2600 controllers?  Those things would break so easy...  and when the controller half worked we still played games on it. 

I think the problem is that people see Wii games as one entity.. if one crappy game comes along with waggle, the "wii control system is horrible", i have really never heard all of the games of a system be generalized for its controls before the Wii came out

 You must not be old enough or perhaps you just don't remember.  Back in the early 80's the 2600 and C64 both used the same controllers, it was the standard way to play games.  It seemed like it was the way to do things at the time.  The expectation of many kids was that the 2600 controller would be used for many years to come as they'd become accustomed to it.  The first time one of the 2600 players picked up an NES controller they would have screamed bloody murder as it would have made no sense to them (I was one of these people) I instantly hated the NES for it's crappy D-pad and 2 button controller you held the wrong fricking way.  In fact I believe the first time I held the NES controller I held it the wrong way.  Gamings past is litered with this stuff... everytime a new controller comes out, people scream murder.  The N64 controller also suffered from this same problem.  The old school needs time to retrain their brains...  I almost never played an NES again, man that would have been a shame!

this is what happens. u have new input or output and both the technology and skill has to follow it. going from 2d to 3d was a huge change, which cause quite a few games to have bad controls along with the fact that the controllers just plain werent good. Now the ps3 and 360 controllers are very precise and the devs know how to make games control well (whether or not they apply it well is different).

now u have the motion sensing along with crappy technology (i said it). very few games on the wii can have the crutch of non motion sensing controls. since the motion sensing isnt 1:1 (or even anywhere close) the devs have to do some pretty tricky stuff. it will take and either people will go around it or figure out how to use it.

What's he talking about, "sloppy controls for the Wii"

Maybe he was talking about Lair?

 You are right, my first console played was the NES, so i guess i never would have noticed such a change back then