First of all they make the games run at 60fps, such as they did with a Driveclub demo a while back optimizing the game to reach this frame rate. Then they use a technique called ‘re-projection’ to generate the in-between frames and double the 60fps to 120fps, reaching the point of making the games playable and smooth…

The camera is that little rectangular black box behind House’s neck. He is blocking it a bit in this shot.