Late last year I had the honour of working with one of the most well known computer game characters of all time, the famous blue hedgehog, incorporating him into an interactive augmented reality app for iPhone.
The app is a promotional mini game for Sonic's 20th Anniversary. It is an augmented reality game where users attempt to capture Sonic as he races around, usually too fast for human eyes to see.
We used the String library for augmented reality image recognition handling, a library I highly recommend. String processes the camera input in real time and provides orientation matrices of any of the pre-defined images that are recognised. The app uses this information to render a 3D animated Sonic running through the scene, oriented relative to the marker with 3D perspective. Look at the marker straight on and Sonic runs past in front of you. Look at the marker from a sharp angle and it is possible to see Sonic running in from a distance (or running away into the distance, on the other side).
Update: Unfortunately the promotion has ended and the app is no longer available for download from the App Store. See an archive of the app details.