Touchscreen project? There was a touchscreen project?!!
Circle Dock works perfectly on touchscreens. However, the Sarge is referring to the possibility of adding gesturing support similar to trackpads found on more recent laptops and netbooks.
There are two different touchscreen technologies: the first is "resistive-effect" which has been around for almost 30 years and is the type most commonly used in ATM machines. Whilst robust, it's not terribly accurate. A much more recent technology is "capacitive-effect" is far more pixel-accurate and this is used for screens found on Smartphones, iPads and similar devices.
The touchscreen referred to uses the older resistive-effect technology and emulates mouse movements and actions involving the left mouse button. A gesture on such a device would be received as a left mouse button down, a movement and then left mouse button up. Circle Dock would need to build a memory map of all cursor movements, from the moment the mouse's left button was pressed down until it was released, and then trace all the coordinates in order to interpret the gesture. The amount of code required to do that - and the overhead in time and resources - would have been substantial and for little gain since very few people would use CD in that way.