Eurogamer, more advanced tracking from the Kinect is possible -- but only through a firmware update which its sources say is coming.
The Kinect sensor would be able to transfer up to 35MB/s of data, but is currently locked to about 15MB/s. The artificial limit is imposed by the fact that multiple USB devices may be connected to the console. However, Microsoft engineers are supposedly working on a fix that will allow a greater amount of data to be transferred from the Kinect, upgrading the 320x240 image it currently uses to a 640x480 one -- an effective fourfold increase in pixels.
Digital Foundry's Rich Leadbetter's said that a firmware-based solution is "doable," but admitted that there will be additional caveats for Microsoft to address. "It is uncertain just how accurate the camera's sensor is," even when operating at a higher resolution. "Additionally, processing four times as many depth pixels could slow things down more."