It is certainly most of the way there now - the sensors are fantastic - and will be absolutely revolutionary with a higher-resolution screen and the addition of some yet-to-be-invented control schemes.
Actually, who says you need complicated control schemes and traditional video games?
Bizarre idea: strap on a Rift headset, instead of a treadmill you've now got some kind of thingamabob rigged to tilt and turn an exercise bike. The exercise bike has a few simple buttons for game input on it. You now play something simple that can really take advantage of immersion and graphics quality like Pokemon Snap, while riding the exercise bike.
I mean, sure, you could make this game with the treadmill version and walk down the safari trails, but that wouldn't be a very good workout.
