I like the idea... a lot. The graphics are fine...
What it needs is someway of recording your interactions and saving them so that you can see them later or show them off to other people.
Some people mentioned the delay could be a problem... but anyone who's been a DungeonMaster or a Storyteller or whatever, will know that shouldn't be problem...just prepare a bit beforehand. Of course unexpected things will happen and you'll have to improvize... that's the fun of sponteneous roleplaying

I do agree that the price is a bit ouchy... but then again it is TWO copies....
I'll probably pre-order.