spindown: It looks quite interesting, but I'm not sure if it will actually work. Rock Band 3 tried to make the jump to real guitar before, but they were apparently faced with a dilemma. According to the RB3 engineers, using a regular electric guitar creates too much input lag because the frequency of the string vibrations has to be translated into notes, which creates a noticeable delay (especially for low frequencies).Therefore they decided to go with a special midi guitar and drop support for regular guitars. However, not many people were willing to buy a $300 instrument to just to play the game, so Pro Guitar in RB3 was kind of dead on arrival.
I'm very curious to see reviews for Rocksmith to see how well their approach works in practice. I hope it works well enough since it would be a great training tool, and a lot of people already have guitars lying around, so they wouldn't have to buy one for the game.
There's also making sure to disable any extra filtering and image processing that HDTV's do. Usually there's a Game mode that disables them. The game will also need to be 1080p native (which it probably is) so that there's no hardware 720p or 1080i->1080p scaling causing input lag. They mention this in the faq.
