Also, the gorilla arm would go away fairly quickly. This used to make me tired:
http://www.youtube.com/watch?v=mPKbCsWLe4k
Now it doesn't. I expect people would get used to minority report interfaces, particularly if they didn't immediately try to transition from 8 hours of keyboard to 8 hours of minority report.
My real question: is source code for this demo available?
I work in construction, I spend my days holding 5lb drills in front of me. Using the standard gesture position (forearm down) your arm won't get tired during a day. I basically live my day in the 'gesture position' often for well over 8 hours a day, always with weights in them.
When the upper arm is lifted is when your arms get not so much tired but literally drained, which is what I think the Kinect will likely have to adapt to.
I'm not envisioning it as a primary input device, naturally (although the deaf seem to get by fine). But I don't think I've ever been in a situation where a heated conversation made my arms tired; as a replacement for a few basic mouse tasks, I bet it could even improve ergonomics.
Just try it: raising your arms as if gesturing conversationally is way, way less stressful than reaching out to touch your monitor.