Yes. I agree. The hardcore gamer will not stand up before the machine and wave his hands to control a game. It will be too dark for the camera in this little dirty room anyway.

I think this kind of entertainment will take place in living rooms, families or party guests will play such games. It is really a similar concept like the Wii. It is just the next evolutionary step.
Boxing with a Wii-mote was fun, but fighting Karate without any attached controller at all will be fantastic.

With this in mind it will produce similar games: sport games, physic based games, fun games, family games. But it can also open some new areas. So you could control an adventure game with speaking and gestures. The hero could answer you with funny comments while watching directly into your face and even commenting some of your actions personally, your stance, your outfit, your face. It will be a much more personal experience than these indirect games.