How do you guys think they are doing it? Here is my guess at it.... they use a VM that read the non-native binary code and 'translates' it to native code. Sort of Java at the assembly language level, which begs the question, is it faster than either Java or .NET applications? They lose a lot of compilation/optimaztion benefits by working at such a low level.
I think you hit the nail on the head, there. They mentioned something about dealing with chunks of code, rather than translating a line at a time .. and inferred that this was their big breakthrough.
I really hope that that is just smoke and mirrors, and that they are holding their 'real' advance back until they launch their product ... because I don't see that kind of 'optimisation' allowing me to run FarCry on a Linux box.
I also find it interesting that they used a game (Quake3, iirc) that has a linux port to demonstrate their product. Everyone has played Q3 on linux, and played it well. If they had done the same thing with UT2004, or Farcry, I would be impressed ... the use of a game already ported to that platform raises some questions.