Saw this over at
[H]. A small startup company seems to have created a small piece of software that lets you utilize a wide variety of objects as game controllers with the help of any webcam. From the video, you can see that it first locks onto an object (preferably a brightly colored part of the object) and then will track the motion of the object within the space of your application. I don't know if it can figure out the Z-axis of an object but it definitely can take the X-axis and Y-axis of the object and translate that to the screen well. Props to the Decepticon laptop. If you want to know more and signup for some testing, you can go to the
Cam-Trax website.