Action games that require inputs over more than 2 degrees of freedom just don't work so well on these devices. It just gets worse when you need to take up screen space with buttons too.
But while it is the FPS genre that seems to be the showcase for shiny new GFX tech, there are other genre's that could benefit. Adventure games that involve exploration and environment manipulation would be great. From stuff like the Schism games to next week's release of Amnesia.
Although, maybe without the evasion stuff.