Since 2010, Microsoft has been working on a gaming display system so small that it wouldn't need to be sitting on an entertainment unit or even held in your hands. You could wear it in a pair of glasses. Or in a stupid helmet.
The company sees two avenues for such technology: the glasses are an entertainment possibility, while the helmet, being the more heavyweight solution of the pair (including the same display tech but with an accompanying headpiece), could be used for gaming or more practical uses like aviation.
How would the glasses work? It's proposed in a patent that to get around the problem of the human eye being unable to focus on objects so close, it would distort to appear as though it was 21 inches away. The glasses could also adjust their transparency depending on the use's tastes or a game's needs, so you could black everything out and just focus on the action, or conversely use the specs as augmented reality devices able to overlay imagery onto the real world.
Sounds crazy at first, but then, the future always does.
Remember, standard patent disclaimers apply: just because a company is researching stuff like this doesn't mean it'll ever come to market, etc etc.
Microsoft Invents Projector Eyewear for Xbox & Beyond [Patent Bolt]