If you have more than one camera, you can produce a 3d model of the human and so it will be much! better than eye toy. hOWVER, If the soul purpose of the wand is vibration, then it will truely be a sex toy
I think it could be good technolgy for the next genation. Imagine a sensor bar which has two cameras attached rather than just two infra red LEDs
intel want to sell fast chips. image processing takes a whopper of number crunching compared to the low dimensional motion detector data. BTW... the power of the PS3 could probably do this already. I mean image processing is what it is good at (unlike 3d graphics rendering)