I remember in the early/mid 90s going into Boston to a ‘gaming café’ and playing a very primitive shooter game in a virtual reality setup. You got into a raised circular area with waist-high padded bumper rails, put on some wired gloves and a helmet, and using a combination of in-glove controls and your actual movement, you played the game. The actual gameplay was shooting a single-shot ‘gun’ at the other player in the VR setup across a small and primitive map. My friend and I almost got kicked out of the place due to hogging the machines.
At the same place, I remember playing the Japan’s version of the Sega Saturn, specifically Virtua Fighter. This was a few months before the US got the Saturn and Playstation, and at the time the crude 3D graphics of Virtua Fighter felt like seeing the future in front of you. It was mind-blowing stuff compared to what we were playing on the SNES/Genesis.
Over the last few years, have we had any Virtua Fighter-like moments? I know we are still waiting for virtual reality setups, and to me they seem further away today than they did back then. Sure having the iPhone as a mobile gaming platform on a cell phone is great, but the innovation there is more with the platform than the games. If anything, the best iPhone games are just re-releases SNES/Genesis titles or clones.
An interesting side-note is what happened with the Wii. Nintendo was coming off the horrible GameCube, and by many was considered a non-factor against the PS3 and Xbox360. Then they release the Wii, with its incredible motion controller, and everyone goes nuts. And much like Avatar and 3D movies, the Wii and its “play by moving the controller, not hitting buttons” fad is done. We are back to hitting buttons on standard controllers, just like we are back to watching movies in 2D (sorry to everyone who bought a 3D TV).
A similar entry but one focuses around MMOs is coming ‘soon’.
Hardcore Casual 
The Oculus Rift seems like it might be pretty solid, there’s a lot of good buzz online anyway. And LeapMotion is doing some interesting stuff with motion sensing controls. We could see some cool developments in the next few years!
I remember playing Virtua Fighter in a conference room at the office after hours. One of my co-workers would bring in his Sega Saturn. It was amazing stuff on a big screen. When I first saw it, it was like something completely new.
There are relatively few “wow” moments like that and they tend to stand out in my memory. I am reaching though to recall the last one. It might have been EverQuest, running around in a 3D world, and coming upon the cyclops that roamed West Karana. That scared the crap out of me.
I am interested to see the Valkyrie stuff that CCP has rigged up with the Oculus Rift system. Maybe that will pop as well.
Back then, graphics were improving by leaps and bounds. Improvements between console generations were obvious to everyone. It’s not that graphics don’t improve anymore, but the difference between excellent and more excellent isn’t readily apparent. I doubt the Wow Moment will come in that department.
Oculus Rift might do something for gaming, but it doesn’t look like it’s coming down in price and hitting mainstream anytime soon.
I guess we’re waiting for the post-Singularity world — where the ideas of consoles and PCs are obsolete. And TVs are obsolete. And gaming happens in the skull. Maybe.
VR with motion sensors is promising. For instance, EQ2 has the SOE emote that really does reflect a player’s facial expressions in the game. A few steps from full representation. And don’t move from the pc camera’s LOS. Anyhow I also played those early VR attempts. A gun and a few platforms, run around, stilted, and fire at things. Awkward. When game developers are able to beat their heads against what motion sensing can do some new games may turn up. The strict limits of 1980’s and 1990’s era video games produced fun stuff with limited graphics. Game mechanics should take a leap forward with motion sensing but not until someone actually pains over coming up with something. A piece by piece, try and fail, try and fail, try and fail, then a brief success! o, that’s life I guess.
When you are young, you are a lot more impressionable when it comes to cutting edge tech.