This isn't intended to be the Holodeck - but it's a step in the right direction.
For that matter, how would you represent a jump?
That said, I'd use the hell out of it for a game like Skyrim, or other open world environments. And it can be so much more than that, .e.g. ocean/space environments for instance.
The gameplay is secondary - there are a lot of motions that can't be expressed well using this device (although with the kinect, you can unlock a lot of arm motions - good for sword play, I'd wager) - but it's superb for walking in fantasy environments.