Imagine a VR headset, but with the real world fed in (e.g. through two cameras. Or perhaps a screen can be developed with transparent picture elements that allow seeing the real world through the screen depending on alpha). Virtual reality, video game content can then be superimposed and placed upon the real world. The virtual reality content can then be interacted with using some kind of peripheral - a gun controller, to shoot things, a movement sensing glove for throwing magic fireballs. The real world can perhaps be altered too - lighting dimmed, shadows added to simulate night while it is day.

This is the new gaming. Somewhere between real world sports and video games. You could have a tennis racket peripheral and play a match against a virtual reality famous player. You could fight off demons from hell in your garden, horrific monsters jumping out from behind your garden shed (Oh my! Video games that are athletic!). You square off on a playing field against your friend, standing apart, arms ready, and like a Final Fantasy game you summon huge beasts to fight on your behalf, a towering behemoth stands behind each of you, spewing fire and roaring, pounding the ground and causing a brief superimposed VR effect of the ground shaking up and down.

Monsters leave footprints in the virtual world, these are persistent - the entire virtual world is persistent perhaps (or at least as much as the average video game is).

Fight in the real world across the internet. Real world physical arenas could be built in different countries, identical in every way, a pro team in one country remotely battles a foreign team.

Different game types: a procedural game, which adapts to your own environment (the monster jumping from behind your garden shed). Or a completely virtual game, which you must play on a large open space, castles and chasms superimposed over the environment.

One key problem: the virtual world has no physical effect on you. Monsters or NPCs will not obstruct you (perhaps an NPC moves out the way if you get too close, or a close encounter with a monster turning your goggled vision red with blood). Or perhaps the virtual world simply stops moving, as you walk into a virtual wall. But it would be odd seeing the real world ground move beneath you as you continue running against a virtual wall. Perhaps even the ground is virtual - nothing real is seen. But then you might eventually walk into a real world object despite the virtual world being stationary.

Imagine the Final Fantasy style battle again, but perhaps even with the menu system superimposed over the screen. Do you press the "attack" option with your hand? Perhaps better, a hand gesture - you point your hand at your enemy and scream "attack".