Hi old man emu, a friend and I worked on this problem for a couple of months and I eventually got it to work, but the quality was low, the noise was high, and I found it took way less labor to just use Autodesk's 123D Catch. It's not open source, but it's 100x easier to teach someone else how to do.

I'll post a few pics of my set up and progress, but it took a lot of time and frustration. http://sdrv.ms/1aTxVmZ

It works okay if you just want one side of something, but there's a lot of manual post processing that goes into it. Once you want to get the full 360 degrees on something, you have to delete a bunch of noise from each scan, align the scans semi-manually (meshlab has some nice align tools, but you still have to tell the program some key-points to line up) and then do surface reconstructions that tend to obliterate detail to get a mesh from the point clouds. The resolution is going to be a limitng factor too, that PS3 eye is 640x480. I eventually tried hooking up my dSLR to my webcam for higher resolution, but still was getting more noise than detail.

I don't mean to be too discouraging, just wanted to provide some feedback from someone that's been through the whole process!