The Witcher 2 - Preview @ IGN

IGN was flown to Warsaw to see The Witcher 2 in action.  They were given a "brief"  demo and wrote about the results, with added comments from the dev team:

As you would expect, overhauling and improving the combat system has also been a key focus for the team. Although we weren't allowed to try it for ourselves, this time around, the team is promising a "more dynamic" system that it reckons will make it a far more engaging and rewarding experience. "You'll be able to combine magic and sword attacks in the way that wasn't even possible in The Witcher," we're told. And thanks to the flexibility of the new RED engine, it has been possible for the team to script the combat encounters in a less conventional way, so that, for example, optional endings can be added to epic monster battles, or non-linear encounters where the outcome depends on more than your raw skill.

During one of the scuffles that we were shown, we're told that the game's collision detection will be able to take into account environmental obstacles - including anyone unfortunate to be standing in its line-of-fire. "When an enemy is shooting an arrow at you, it's not predefined that it's going to hit you," he says. "It will hit anything on the way between the arrow and you, so if you're cunning enough to position yourself correctly, it can probably hit one of your opponents, and it's the same with things like fireballs."