Microsoft has continued to deny any rumors about an Xbox 360 motion sensing controller, code named “Newton” but others wish to prove them wrong. CVG‘s says they’ve heard this motion sensing controller is indeed real from Xbox World 360 magazine.

Xbox World 360 says Microsoft is motivated to create such a controller to grab a bigger piece of the casual gaming pie, after all, it’s worked for Nintendo. It’s obvious to most that the Wii is a success based on it’s input device, not on the graphics and sound. The Wii has a very low attachment rate (games bought per console) and most gamers are happy with one game: Wii Sports.

Would Wii Sports be as great of a game if it used a standard controller? Highly unlikely.

The rumor is the new Newton controller will be available by the end of 2008. However, Microsoft denies any of the claims, stating, “I’ve never heard of a motion sensing controller… I don’t know what you are talking about…”

There are plenty of past rumors which Microsoft and Sony’s claimed were false, including the 80GB PS3, the HDMI port on the Xbox 360 and others. If the Newton turns out to be real we’re sure to know within a few months as someone is bound to break their NDA on purpose or “by accident” before long.