This was a small course project I did with 3 others for the Human Computer Interaction class at EPFL.
We made a prototype of how such a wearable device might be designed and how would three interaction scenarios with it will look like. A video of the prototype is here (Warning: large file).
Windows phone emulator was used to create the interface and it was overlaid on the fabric using Adobe Premier. The details of the gestures used in the video are briefly described in our report.
We expect this device to be rolling out any decade now.