the question pretty much states the basic idea, but here is my use-case; tabletop war-gaming.

Optimally I would like to be able to tag each of my “play pieces” with some sort of tag, place a few sensors around the perimeter of the play space, and have a device running an application that would be able to tell how far such and such tag/unit is from any other in the play area.

As such:
    

1.	Such a system would need to be able to differentiate different ‘tags’, or if tags aren’t used, some method of doing so
2.	Have millimeter or better accuracy, and scope over a variable play area approx. 5 to 10 feet cubed. 
3.	Be able to ‘refresh’ in a reasonable amount of time. (every few seconds is good enough)

Optionally

4.	Some sort of powerless tag if its workable (so I don’t have to worry about switching batteries on hundreds of small figures)
5.	As many ‘store bought’ components as possible. (and hence, reasonably affordable)
	
I’m a software guy, so once something gets to the point where there are raw numbers coming into a computer I'm good, but as far as electronics, I’m having a hard time finding or even thinking of how to put this system together. I have looked at rfid tags, and they seem good for storing information, but not so good at triangulating distances. Any help or advice would be appreciated, but for this question;

What hardware/technology/setup can possibly (and hopefully nicely) fulfill the above requirements? Is there such a thing?