The Kinect creates a pseudo-holographic by using a simple engine. This is not like a holographic card that needs to be physically move back and forth to get the effect. The Kinect recognizes where the viewer is positioned. After it figures out your position, the 3D engine adjusts the image in a view that gives the illusion of a real 3D object. To have better effects in real life, the 3D engine supports anaglyph 3D (red/cyan glasses). When controlling the application you simply use your Window Phone 7 app.
This particular demonstration shows a possibility for gaming in the near future Using the Kinect could immerse a user in the pseudo-3D world with projections on the wall. The rumored Kinect 2 may just have the resolution to keep track on head and even eye movement, to make sure 3D effects likes this one becomes real.
Looking for the original Youtube poster's, programming4fun's, "HoloController" source files have turned up nothing past a collection of videos. I am sure more will surface soon.