To be fair, it should be able to do at least as much as games like Nintendogs. Nintendogs had a good amount of play value judging by what little I played of it, and it sold really well and saw two new versions so it must have been successful with its target audience. EyePet is going to be sold with the camera (possibly even replacing the standalone camera package) so it could be seen as an investment for other EyeToy games like Eye of Judgement.
The crucial difference between Nintendogs and EyePet is that the DS has a direct input system--essentially like a mouse--whereas the EyeToy has to "see" players' movements and objects and properly interpret their meaning and position within the three-dimensional space, all in real time. If it cannot do this with adequate speed and fidelity children will be frustrated rather than entranced. I also think a certain percentage of parents will be creeped out by the creature and therefore refuse to buy the game (I know I would), so it may not even sell all that well even if the gameplay lives up to the hype.

I've seen and read a lot about the EyePet and there doesn't seem to be much point to it over and above interacting with this "thing." At least Nintendogs had you upgrading your house and encouraged you to keep more than one dog...
It reminds me of the whole Project Natal thing and the even creepier tech demo that Lionhead did with Milo, the interactive "child." Great concept, great execution, but what sort of an application will it have in games? Will ideas like this even translate into good games? In the case of the EyePet, I'm guessing not, but I'm sure Sony have done their market research and project to sell "X" number of units by a given date. Good luck to them... I return to my previous statement regarding yuppie parents. :-)

Oh the horrendous face of unspeakable evil....

My wife also noticed this a long time ago when it was announced. When I showed her the pic, she said it looked like a Monchichi. I didn't know what that was, so she explained it to me. When I asked how in the hell she knew what one was, she said her dad had one and he gave it to her when she was born.

The one in the back looks even more disturbing ...it looks like it's enjoying something it shouldn't be ...

That's the one i meant. He's definitely high on something...