Looks like everyone knew this would happen. The first interactive sex game for Kinect is being developed by an Australian sex game developer ThriXXX. This is the same company behind 3D SexVilla and other titles.
The company said that it was able to make the game thanks to the recent hacks for Kinect including the open source driver project called libfreenect which ThriXXX is using. The programmers are also using OpenCV and the game should also work in Windows 7 which critics say Microsoft would not allow.
The company reported that the software is in early alpha testing and is to be released in 2011. ThriXXX plans to have Kinect support into all of the games based on its engine.
You can check the video which demos the game in action.