Interesting sensor. It seems to output a analog voltage relative to the distance of an object reflecting the infrared beam. It would seem to me that the sensor output voltage could be wired directly to an Arduino A/D input pin. Not sure what the second link is showing and how it would be used with this sensor.
One thing to keep in mind having looked at the data sheet link shown in Sparkfun and that is that the relationship to distance Vs measurement output voltage is not a linear function, so your code would have to deal with that.
Well if the output voltage was linear then the measurement voltage would be say half the value at 10cm distance that it would be a 5cm distance. There is a chart in the data sheet showing the curve of output voltage Vs distance that better shows this relationship then I can explain. Over a narrow range of distance there can be a pretty close to linear relationship, but over it's full range it is clearly not linerar. Also not kind of a 'false' output voltage when distance is closer the 4cm, this would also have to be factored in depending on your physical mounting and application of this sensor.
I don't think that will be a problem for what Im trying to do though, as I don't require an accurate measurement of distance. I intend to use the sensor to create a real time animation through MAX/MSP/Jitter, where a series of coloured squares respond to the proximity of a persons hand. (changing colour, becoming more vivid the closer the hand is to the sensor, etc)
Does anybody know of a way to manage a large number of analog inputs. I'm considering a project where I would like to use over 100 proximity sensors at once. I would prefer to use Arduino. Is there some way to address this many signals to one (or a few) Arduino?