Here is a link to full article: Kit attacks Microsoft keyboards (and a whole lot more) • The Register
Well it was bound to happen. Just a matter of time before someone created a proof of concept in attacking wireless devices like keyboards. Too bad companies like Microsoft believe such devices are safe and use such crappy encryption techniques. Like this article mentions XOR is a crappy encryption algorithm and Microsoft should not be using it. There are plenty of public encryption algorithms out there which are much..much stronger.
On the flip side its a good thing Security researchers are proving such attacks. Better good guys then bad guys :-) I'm sure we'll see more on this down the road. As hackers move from mainstream attack vectors to new pastures we'll no doubt have new security countermeasures to stop such hardware attacks. But step 1 is better encryption of data stream between device and receiver.