I'm interested, but not convinced.  

1.  Are games going to be fun without a controller?  Why would I want to play a racing game with imaginary air instead of just using my wheel?  Which is more realistic?  GT5 or Forza 3 with air controls or an actual wheel?  Same can be said about an action game...waving my hands around with an "air" sword.  Those who have said that sometimes a controller is necessary are right.  Sometimes it looks more like a headache than sitting back and just relaxing with a controller.

2.  Milo is very interesting, but how practical will it really be.  I really have my doubts about the AI actually being smart enough to understand my words and actions beyond simple things.  If I say in a sad voice that I did really bad on a test at school and it says something stupid in reply like "I don't like going to school either" then it will be an epic failure.  A gimmick.

3.  How accurate will it be?  Will it be as accurate as Wii Motion+?  Will it be 1:1?  When they were hitting and kicking the balls at the bricks, it really didn't look like it was all that accurate....tons of balls that looked like they were hit, weren't.

So while I'm not writing it completely off, I'm just not sold or convinced yet.

but in the burnout example it wouldn't be able to tell how fast you want to go, or if you are breaking.

I doubt it can guess where your foot is if you have a table obscuring most or all of your lower leg.

No, and I definitely don´t want to play like that.

Are you drunk?

If they can implement these two game ideas(and I see no problem even with what they showed at E3), hell yeah I will clear the room:

Discs of Tron game - For anyone that has seen the movie Tron will know about what I am talking about. There are two players, each on a standing on a platform consisting of multiple rings placed together much like a cinnamon roll. There is a disc that can be thrown and caught. The idea is to throw the disc and hit the opponent players rings which makes that ring disappear. The player must try not to fall through the gap between rings that was just created. You can dive, duck, throw, catch, etc. All of this is possible via the current functionality of the Natal device. It can read a 15 X 20 space so that is plenty of room to play in. Catch the thing by just clamping your fingers down on the disc. Run and throw for increased power. Make sure to jump across gaps to avoid falling while trying to catch the disc. Finger movement will determine when the disc is released mid throw. I think this sounds fantastic. No controller necessary and is fact much better in this scenario. Online play a big feature.

Dodgeball - Once again uses the 15 X 20 area that Natal can detect. Pick up, throw, dodge, jump, etc. If a ball is on the ground 5 feet in front and to the left. Walk over and pick it up, virtually of course. Online play a big feature here as well.

@JaggedSac: I suppose 15x20 is in feet? So that's like 4.5 meters by 6 meters.

How far away do you need to be for it to see your entire, upright body?

I'm talking average height, not a 2 foot dwarf or an 8 foot lank.

15x20 (assuming this is 15 wide by 20 deep) is bigger than most family rooms with no furniture. Good luck finding a 15x20 area to play in

Coffee tables are going to become a thing of the past. If someone does have something in front of their couch, they're going to be the small little easily movable things.

Wii Fit owners already very much understand this.

Also, from what I understand, Natal will let you sit down too, it just depends on the game.