Except that, in the video, it mostly just looks like a random fold in his jeans. The article image is a single frame that looks dirty out of context.
I think this truly is an “Xray Specs” effect–that is to say it does not actually reveal something hidden. Much like the diffraction filter chicken feathers inside the XRay Specs novelty creates a visual artifact that suggests the bones of your hand, the value mapping in the Xbox scanner merely creates an exaggerated shaded form from the clothing folds that suggests something else.
Also just like the XRay Specs-- it’s hilarious!
If it can be seen then it can be used as a controller.
My new kickstarter project, an open source wang-based controller for the XBox, I call it:
The Joystick!
“A dirty mind is like an endless party.”
A friend of mine once told a girl there was a brand of computer called a Wang. She asked, “And what kind of games do you play with your Wang?” Without thinking he blurted out, “I don’t have one!”
Ya, it just looks like the “zipper-flap layers” standing out smoother than the rest of the fabric in the area.
Simple pareidonglia.
You have won this comment thread, and are in the running for the whole internets for today 
Oh good, there needed to be another way for dicks to get on XBL.
I approve this message.
Anyone else remember their slogan-that-never-was: Wang Cares.?
You know who needs this? The NSA! Then, they need to hand them out for free to everybody! With no off-switch! Orwell was lame.
They don’t call it the XBone for nothing!
“I wave my private parts in your direction.”
It’d the end of privacy as we know it.
Really, anybody can see my naughty bits. Just call.
If there’s a “wee dong” problem, it’s not the Xbox that has it. 
Ugh, this guy. I remembered him for the semi-hysterical article that he wrote on giant killer mosquitoes in Florida, which, it turned out, weren’t really all that big of a deal. Now he’s losing his shit over two parallel wrinkles in his Dockers? FFS.
I’ll just drop these two relevant Penny Arcade comics.
and
