Does Kinect Really Work?
Solution 1:
I bought a Kinect, and overall I'd say that yes, it does work.
However, it has some (potentially) strict requirements in order for it to work optimally. You need to stand at least 6 feet away from the sensor, ideally more like 8-10 feet. For two players, 8 feet is the minimum. If you are too close to it, it doesn't work really well at all. Some games might need more room than others, though (I've heard that Your Shape wants you to stand at least 8 feet back, with room behind you in addition, but I haven't played it yet).
The movement in-game does mimic your movements, but there is a very slight lag, and it doesn't always get what you're doing correctly (although it is right most of the time).
Overall, I'm happy with my purchase. I did have to rearrange my gaming setup for it a bit so that I had more room to maneuver, but when set up properly it works really well. If you don't have room for it (or can't make room), then I'd suggest holding off on it. the Kinect Support site has some information on how to set it up, so that might help you determine if it would work for you or not.
Solution 2:
I got mine a couple weeks ago and can confirm that it does work pretty well. I haven't seen any lag issues of the type Andy described. It seems very good at recognizing your shape and translating that into the game. The only thing that is slightly annoying is menus where you drag a hand around the screen to the option you want by waving your hand in the air. It can be tricky sometimes to select options when they require fine precision to hold the pointer over them. In the games everything works almost flawlessly. Another quirk is that the games seem to take a long time to load and it seems to want to go through some calibration each time you start them. Plus, it seems like you can't skip through the intro screens as much as you can with traditional controller games. It can take up to 5 minutes in my experience to get from power-on to playing the actual game. Minor annoyance though.
As for the gameplay. It is really cool and fun, but it will wear you out quickly. Most games require some amount of jumping and a lot of physical activity. If you aren't in really good physical shape, 45 minutes of this game may be about all you can take unless you are switching off with another player.
The biggest concern for me is the longevity of it. After only a few weeks and about 4 gaming sessions, the simplicity of the games makes them a bit repetitive. The novelty is already starting to wear off. If you were going to use this as a replacement for exercise equipment (any game will work, no need for the fitness trainer games) then I could see it making it through a holiday season before it starts collecting dust. This could improve once more games start coming out. Time will tell.
Solution 3:
The short answer it works. Read for yourself -- Google News: Kinect. Hacker are hacking away and coming up creative way to use it. So good that there rumors that Microsoft is going to use the technology in their next release of Windows. Finally, the overall reviews (here is one by Christan Science Monitor are good.
Solution 4:
The OP asked specifically "does it work for kids" so I'd like to caveat the accepted answer with a "not really". This Christmas, we got one for my almost 4-year-old with Once Upon a Monster, and it fails to pick her up more often than not. I've re-run all the "tuning" and "calibration", tried it in the daytime, nighttime, with and without bright lights in the room, and most of the time it just can't tell she's there. My 6yo seems to have little trouble, but the younger one must just be too small.