To me,this is not practical.
Your arms would feel like falling off after a while.
You would be continually cleaning the Screen.
Your hands block vision to a degree.
Ladies with long finger nails would wreck the Screen.
The mouse makes more sense.IMO.
A step backwards to me.
What are your thoughts?

http://youtube.com/watch?v=GqDQ0wUcSPQ

Microsoft came by to the university with a series of videos showcasing this, the general reaction was wow and that's cool. Thinking about it though you are right if anything it will reduce functionality.
The picture demonstartion part of that video should have shown the person writing on the back of the card and then sending it to someone...Who thinking on wouldn't be able to recieve it without the same expensive hardware.

Essentially, this is an extension of touch screens which have been around for many years.

I suspect many folks didn't like the concept of a mouse when it was first introduced.

As they say - "Progress happens."

The video did show some nice things but who knows - there have been numerous fake videos about Windows 7.

On some of the comments, people have been posting that this is a fake.

Either way fake or not...

Wat ever it is - it's quite good!