@Amrita - I had a look at ARSoccer, I hadn't seen it before. You need to use image analysis for that type of thing. OpenCV could be useful. You can detect motion by comparing consecutive frames of the camera feed i.e. look at what has changed between frames. You should also look at edge detection algorithms.
Those sorts of games were very popular when web cams first came out so you may find some info related to developing them for a desktop environment but the algorithms would be applicable to iOS.
I saw a game called A Noseball Challenge on the App Store which was like AR Soccer but using the face. You could do that pretty simply using the SquareCam code and a physics engine. I don't know why the SquareCam code didn't work for you, you'll need to ask Apple about that. It works fine for me. Just remember it is iOS 5.x only.