That demo is running on the MIT TX-0, a transistorized version of Whirlwind and the predecessor of the PDP-1. It was somewhat obsolete at that point, so projects like this could get time on it.

However, going this route for real likely means multi-decade research and iteration.

Demos are quick to make. Generalizing and turning it into real reliable software seems tremendously hard, and beyond just a shift in mindset.

Fortunatelly, we now have vibe coding, so anyone can experience first-hand the frustration of trying to just shift your mindset and immediately reaching a metric ton of limitations in the very first iterations. It's a humbling experience that I recommend to anyone (go ahead and change the world with precision UI, just try it).

Every design tool today (Figma, Illustrator, CAD) still uses this exact UX pattern. Sutherland nailed it 62 years ago with a light pen and an oscilloscope.

See https://tx-2.github.io/videos#sketchpad for more video, including appearances by Sutherland himself. https://tx-2.github.io/ is an active effort to get Sketchpad running again on a new TX-2 emulator.