Actually, if you look at the press photo engadget used, you can see the sensors. What looks like two pieces of cardboard wrapped with wire.

Three friends and I created a similiar device for a group design thesis, it used capacitive sensing similiar to a thermin (http://en.wikipedia.org/wiki/Theremin) to detect hand movement in a 3D space. It was very cheap to produce, the sensors were essentially cardboard, wire and tinfoil. The tough part is deciphering the information you get, and that can be done via a driver using system resources, so I don't doubt that it would be cheap to produce.

Ladnar, first thing I thought of too. Made me do a pretty good double take. Go Blue!

Sonos for home audio

Most focused thread I've read in a long time.... (waits) .... pick me, pick me

The question is, in Figures 4 and 5, what is #20 referencing. I think whoever drew this, had way too much fun.