Adafruit Industries has offered a $2,000 reward for creating an open-source hack for the sensor. Phillip Torrone, one of the heads of Adafruit, told CNET that Kinect is "amazing hardware that shouldn't just be locked up for Xbox 360. Its 'radar camera' being able to get video and distance as a sensor input from commodity hardware is huge."
While it is unclear if these videos are legitimate, Microsoft's response is what you'd expect:
Microsoft does not condone the modification of its products. With Kinect, Microsoft built in numerous hardware and software safeguards designed to reduce the chances of product tampering. Microsoft will continue to make advances in these types of safeguards and work closely with law enforcement and product safety groups to keep Kinect tamper-resistant.
Hacking videogame motion hardware for other uses is nothing new. The Wii remote and sensor bar were hacked to allow for spatial control in a virtual 3D space. If the Kinect sensor has truly been hacked, it will be interesting to see what can be done with the hardware.