Background is great but first give me a reason to get excited about the actual device.
I assume decent results can be achieved with a super-cheap camera module, if the optics are a good match to the silicone part.
Now, what would that look like in practice. I think you should first forget about the form factor. I think the use of a smartphone (at this stage) is mostly convenience. The best lens/sensor/cpu/gpu combos are sold in this package.
When the first webcams came out, I think I would have been skeptical if someone told me "this will be a mouse soon". Today, most mice are basically very VERY low resolution webcams with buttons[1]. Maybe a new type of controller, musical instruments, or an entirely new thing will come out of this... Or nothing much, like the two research paper mentionned. In a mouse form factor i think it could be use for some of the functions of a spacemouse[2].
[1] https://en.wikipedia.org/wiki/Optical_mouse#Optical_sensor
[2] https://www.youtube.com/watch?v=iHBgNGnTiK4 ( I Made my own Space Mouse for Fusion 360 using Magnets (DIY) ). Just check the intro to have an idea on the use of spacemouse.