Well, judging by the hardware on the phone, a 3D game is very possible. We should really wait until Google has the ability to really revise the OS to speed up the phone, leaving resources for more things like games
A mobile developer called Polarbit is bringing some 3D stuff to Android now. They just put out a racing game called Raging Thunder, and it apparently plays pretty well.
They've got speedboat racing, aerial dog-fighting, and FPS 3D games coming too - they've got videos on their youtube if you wanna check it out. Thunder doesn't work on Droid ATM but I'd assume that would be fixed. Hopefully.
Raging thunder looks like a great game that I'd like to play. However, when I had a look at the description of it in the market, it said that the current version does not support the Droid. = ( I'm looking forward to an update that fix that.