I've played some FPS games with a trackpad for lack of having a mouse available, and on a larger, higher precision one (e.g., Macbook size) it was not a bad experience at all. You can move a finger a lot faster than a whole arm. Reflex high-res motion at the pro Counter-Strike level isn't likely, but for the casual gamer, trackpad FPS control absolutely seemed plausible. So I believe this kind of input will work for many games that need pointing, and I also believe it will solidly outpace analog sticks for FPS games.
The Halo two-analog-stick model that has taken over the genre was always awkward and imprecise compared to keyboard/mouse (probably most of the skill in Halo was simply getting used to the stick dead zones and the acceleration/deceleration of the look field). I will be happy to see it fade away.