My wife gave me a kinect this christmas as a present, and it works well enough, but as you have said, you must have a big space to play properly, and even more if you are planning to play with friends (and this is a must, if you want to get a good experience with this device).
And relating to the games, at this point I don't know what to say... Obviously it is perfect to share good moments with family and friends, but to be honest I must admit that casual games for the wii have given me much better experiences. The short game list available for the kinect during these months could explain this, so we must keep hope and wait to future releases, that will take more profit of kinect possibilities.
Oh! A last complain... I don't know if more than 2 players will be able to play at the same time with the kinect (can you imagine the size of a room to allow this?), and that's something that can be very important when you talk about social gaming.