My all-time favorite computer vision project is Text Rain by Camille Utterback & Romy Achituv. Hard to believe that this was done in 1999, long before the Kinect made this much easier.
It was created at ITP, and when I had the chance to spend some time there I did small hommage to this installation. This version uses a Kinect and Box2D. Creative Applications has a nice tutorial on how to do this in Processing.