http://cache.gizmodo.com/assets/e3xbox/e3xbox300.jpg
I don't think that yellow thing to the left is a camera, but if both those other holes are cameras, then that would mean the XBox could indeed be getting full 3D information on you, and that really does open up some interesting possibilities. I doubt the demos are possible with silhouettes, but with full 3D information... maybe.
I remain skeptical until I try it, but I have to admit I'm intrigued. This really could be a big deal. It's cool not because current games will translate to this; they're all specialized for current controllers. It's cool because this will enable new things, some of which are things that the Wii seemed to hint at but doesn't seem to have been able to execute on.