Simple tracking in 3D space

[kylemcdonald] has posted this how to build a simple 3D tracking interface. Using 6 resisters, some wire, aluminum foil, an Arduino, and a cardboard box, he was able to do 3D capacitive sensing. Coupling that with Processing, he was able to overlay an interface using augmented reality. The video above shows a 3D tic tac toe application. While it seems less than perfect, its pretty amazing for how simple it is.

Seen anything similar to this out there? What applications would be fun with this?