Oh my freaking god, this has got to be one of the coolest game innovations I've seen in a long while. Cool enough for me to want to go out and buy it on release. The possibilities are intriguing, but really, there's only one application that I'm really interested in, and that's using it as a sword. I forget the name, but there was this arcade game that was like a shooting game (a la House of the Dead), except with a sword. Since slashing people in real life with a sword isn't very practical, this is the next best thing.
Of course there are other ways for it to be used as a controller, and I'm sure they'll contribute to the console's adoption. One other one I'm interested in is using it for first person shooters. I had to quit playing Metroid Prime because I just couldn't use the controller for aiming or moving well enough.
From what I read, the new controller is sensitive and accurate, so it should be very interesting. I for one have made my decision for my next console. I'll probably have to pick up an Xbox 360 at some point. But I won't be nearly as happy with it, I don't think.
As for Nintendo, they necessarily had a lot of great exclusives, being a games publisher as well, but I think they suffered from a dearth of third party support. Having such an innovative control option would attract necessarily exclusive third party games. Exclusive until MS and Sony rip them off, I suppose. I hope their IP is up to snuff :)