That's a pretty nice representation, I must say.
The Revolution controller isn't going to be need to be moved around that much in order to do things like turning around and such. The gyration mouse used there had a button that needed to be pressed to detect when to move, which required the mouse to be reset in the center. Ultimately, that's no different than a regular mouse.
How the Rev controller should work is when you want to look/turn around to the side, you just point the controller off-screen in either direction, and then back onto the screen when pointing in the direction you want to be. All of it can probably be adjustable with sensitivity settings per game, and any decent FPS already has those options in place for thumbsticks.