Desktop Theatre was my final year project at university. It is an experimental Augmented Reality toy that allows users to create Augmented Reality plays on their desktop.
It utilizes the very helpful FlarManager to recognise pre- determined markers that are printed out and then shown to the webcam.
The application then interprets the shapes and maps a 3D plane with a character/backdrop/other play element to give the illusion that the object is actually real.
The idea of the application is to allow users to record and view each others plays. This is an ongoing project and these features are still being developed, but you can go and have a play at Desktoptheatre.co.uk
Remember you have to have access to a webcam and a printer to play with the application!