Valve reveals haptic game controller for release in 2014
Looks cool...
Yeah does look cool. I'm not sure it will achieve it's aim though (excuse the pun).
For FPS, sticks encourage the most realistic battles (lots of shooting around the perimeter of the enemy

) while the mouse provides the fastest and most accurate targeting. I think the biggest risk with the uptake of this would be from an FPS perspective. It really can't afford to end up falling in between the two.
The mouses speed and accuracy is down to wrist action. IMO the extra dexterity of thumbsticks is what makes the turn and aim thing a little less certain and a lot more fun. But I can understand why competitive gamers would prefer the mouse and keyboard, and don't see how these owl eyes will appeal to them..
I still don't get how iPadders enjoy games whilst rubbing their thumbs all over the screen, but then I do have rather large thumbs.