No I have not been drinking and no we are not in the twilight zone, we are getting Forza 4 in 2011!
If you visit the Forza official site Turn 10 have posted an article on their “technical demonstration” at E3. The demo was showing the possibilities of Kinect and Forza and was utilizing the new engine to be used in the next Forza title releasing in 2011.
From the developer’s post:
“Forza Motorsport Preview” is a select peek at one aspect of the future of the Forza Motorsport franchise, both in terms of the way Kinect has empowered Turn 10 to create a revolutionary way to interact with virtual cars, as well as the breathtaking foundation of a new graphics engine capable of producing the images seen in our E3 gallery. The next full Forza Motorsport experience, which utilizes some of the ideas presented in this demo, will ship in 2011.”
So I might be purchasing me a ‘Kinect’ after all.

