The CityEngine is focused on the procedural modeling of buildings and brings together the term 'Automatic Architecture' that is becoming increasingly common in the industry. We will have more on Automatic Architecture and work coming out research labs in Japan in a future post.
The YouTube demo reel below details Pascal's work on Pompeii and general cityscapes, its it both fascinating and impressive at the same time - bearing in mind all of this is automatic:
Take a look at the CityEngine wiki for more info, including SIGGRAPH papers.
Its not surprising to hear that Google is interested in procedural city modelling techniques and i would expect to see Pompeii and other historic reconstructions in Google Earth sometime soon.