Engadget got a little hands-on time with Microsoft's Project Natal at E3. For those of you who missed it, Project Natal is motion tracking solution.

The first demo that we played was a 3D breakout game, where the player is trying to bat a red ball (or in the case of this version, sometimes 10 red balls) toward a line of bricks at the end of a long (virtual) space. The body tracking is truly impressive -- according to Kudo, it's picking up 48 joint points on the human body. As soon as we stepped into line in front of the box, the avatar immediately took on our stance and movements. And we mean really took them on -- little gestures with our arms, the posture we had, front and back movements -- it tracked with complete accuracy. We did notice a bit of stutter during some finer movements, but overall the effect was impressive (and more than a little eerie).

The second demo was actually just a hack of Burnout Paradise, and in some ways was more interesting than the ball swatting. Kudo and his team retrofitted the racing game to take advantage of the Natal, implementing a virtual wheel for steering, and a foot forward or back as the gas pedal. The effect was nothing short of amazing -- the first time we stepped in to play it was immediately natural (save for the part about having to imagine a wheel in your hands). Sure, we wrecked the hell out of a few cars, but it was striking how easy it was to pick up the feel for it. Kudo insinuated that it would be easy for developers to incorporate this tech into pre-existing games, and we have to say, the possibilities are exciting.