The Penny Arcade Expo opened to enormous crowds this morning. The show has grown to such a staggering size, with multiple exhibit halls and sessions spilling out of the convention center into neighboring venues. It’s looking a lot like E3 nowadays, but the crowd is full of everyday gamers instead of industry folks. (Most obvious difference? Most of the people in costume aren’t being paid to dress up.)

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The Xbox 360 team is at the show in full force, with four booths and gamers lined up to play titles like Gears of War 3, Fable III, Halo: Reach, and a variety of Kinect and Xbox LIVE Arcade titles. It’s been fun to hand around the Kinect booth and watch the most skeptical hardcore gamers jumping, punching, and ducking a variety of Kinect titles.

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The biggest line at the Kinect booth this morning was to play Kinect Sports’ boxing mode. Punching and ducking while your avatar reflects your every move is a blast.

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With a huge show floor to explore, I haven’t had a chance to get hands on with too many games yet. One that I did play this morning is Bethesda’s upcoming Hunted: The Demon’s Forge. Set in an original fantasy universe, this third-person action game has stunning environments, a variety of magical and weapon attacks, and some seriously impressive co-op combo attacks. The two main characters are mercenaries investigating the mysterious disappearances of townspeople—and fighting a variety of skeletons and other monsters in the demo level I played. The game’s set for release in 2011, and we’ll have more details on Xbox.com as Bethesda reveals more of the game’s secrets.

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I almost hesitate to mention this given the game’s storied history, but 2K announced that Duke Nukem Forever is not only still alive, but is coming to the Xbox 360 in addition to Windows PCs in calendar year 2011. Yes, a release date. For Duke Nukem Forever. A game first announced as being in development in 1997, four years before the release of the original Xbox! The game is now in the capable hands of Borderlands developer Gearbox software, so we’re awaiting more news with cautious optimism.

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Watch the blog throughout the weekend for more PAX news, including a hands-on look at Disney’s upcoming Tron: Evolution!