In no way does this herald the end of scanning "like in LoTR".
(which btw, was done with a laser based scanner called Polhemus, not a touch system)

This type of image based capturing to recreate 3D models is nowhere near accurate enough to compete with laser based scanning systems. Just because some quicktimes look pretty, doesn't mean that this can generate accurate, quality, useable surfaces.
It would appear that there is significant webbing .

The system I use has an ISO accuracy of 0.02mm. Image based systems (exepting ATOSS) rarely approach 1 or 2mm in accuracy. Most can barely do 10mm accuracy.
The high accuracy I get allows me to 3D scan a human face with enough detail to see the individual folds of the human iris.
The best this image based thing would do for that is a blurry colored dot where the eye is meant to be.

Also, it will only augment existing motion capture systems, not replace them.
The amount of position samples per second is far below what Ascension or Vicon are able to do. It would need to interpolate an incredible amount if it were to be used in motion analysis.

Forget trying to use this for crime scene analysis. I have been working with the police for years trying to develop a system that will stand up to the very intense scrutiny of the law and the courts.
These sorts of things usually are only used for illustrative purposes, never as evidence or theroy proving devices.

This sort of technology (or similar) crops up every few years and everyone gets exited about it's potential in everyday life.
Rarely does it leave the lab for the real world of non-techie consumers.
Often it stays in the domain of specialists who work in the field of 3D scanning.
And even more rarely is it ever used for practical, genuinely usefull things.

I use all of the types of 3D scanning available tody (image based, laser, CT, MRI and arm/mechanical).
Each technique is intended for specific uses.
No one system at the moment can be a "be all and end all" of 3D scanning.
It is unlikely that such a system will be made available to consumers for many years to come.

I'm not trying to put down the work done by these guys. In the context of what they intend to do, it really is an amazing peice of code. But don't try to apply it to things is wasn't intended to do, it's unlikely to produce useable results outside the areas it's intended for.