I own one of these - bought it pre-made years ago rather than assembling the kit myself. It's a ton of fun, and really does give me a more-intuitive sense of direction. After wearing it for a while around places I go to regularly, I keep that intuitive sense of direction without having to wear it. I've mostly stopped wearing it though, because it looks a lot like a GPS-based parole-monitoring device, and I got tired…
I worked with the guy that designed this gadget (Hi Eric!), back in ~2009 or so. It would be really cool to see another version with smaller electronics, flex PCB, etc. Other features, like connection to a smart phone for waypoint navigation would be neat.
The key components are a compass and motors, and since 2009 those have been dramatically miniaturized, thanks to the smartphone industry. Combine that with flex PCB and I bet you could fit everything in the form factor of a slap bracelet.