I agree very much.
Why play Pokemon on a little screen when you can go to a park and play it in real life? AR Games I think will hugely make people more active and less coach bound.
It will also blur the line between sports and "esports" to nearly nothing.
Additionally, if the sensors are good enough, AR can let us see more of the real world, not less. How about seeing more of the light spectrum? or things moving too fast could be played back in slow motion?
We could see and appreciate a lot more of the world around us.