The gesture control sensors sit where the webcam would normally be (in the centre of the panel above the screen), with what looked to The Daily like LEDs beneath the display.
The Daily Flail
Unfortunately the Murdoch-owned iPad newspaper didn't manage to grab any pictures nor use the gesture control, but it does seem to confirm that we'll see Kinect functionality baked into portable hardware at some point in the near future.
Kinect is already compatible with Windows, with the necessary hardware being released in February 2012 after developers were given access to the SDK late last year.
The motion-sensing peripherals have been a massive success for Microsoft on the Xbox 360, bagging well over 10 million sales and a T3 Gadget of the Year award to boot.