Microsoft had a killer day today, revealing all sorts of updates to the Xbox 360, including full retail game downloads, 1080p live streaming of movies and TVs, and most notably "Project Natal", an attempt to beat the Nintendo Wii at its own game by creating a virtual reality interface that doesn't use control hardware at all, but instead does real-time motion capture using an array of cameras.
It actually looks pretty amazing. Brandon's got everything you need to know, including video, over at Offworld.