We've been keeping an eye on the Leap Motion - a high resolution positional device which tracks your finger(s) and translates the movement in 3d space into multi-touch input on the computer. Up until now, the demos have been mostly showing art or image manipulation, pinch, twist etc.
This one, the AirHarp - is more musical - the result of "a weekend hacking session with a Leap Motion dev board" by Adam Somers who has interfaced the Leap Motion with his own C++ based audio processing kit - MusKit.
Adam has made the source code available here http://github.com/adamsomers.
One thing is clear, though while the Leap Motion does make for a responsive interface, it looks about as hard to play in this form as a polyphonic Theremin. Personally, I suspect that as soon as the Leap Motion becomes available, we'll see a lot more musical applications.
The Leap Motion can be pre-ordered now, with projected shipping of early 2013.
I guess I've been trying to recreate a Korg Electribe all this time..
Its big and it talks Dante, and it has plenty of LCD displays