I agree, I'm glad to see that Nintendo continues to inovative while others just pump up the specs and slap a successing number on the end (ie: Playstation consoles). I hope that 3rd parties will give this idea chance. The last thing Nintendo needs is a failure.
One thing that I have questions about is this: How exactly will this system complement the others? To me, it seems like a GBA [SP] successor. I suppose connectivity between this system and the Cube/GBA is likely.
As for this following the road of the VB, I would sure hope not. I believe that Nintendo has had their share of mistakes and luckily has always recovered. Most of their failed attempts (No, the Gamecube is NOT a failure you XBOX fan boys) took place in the SNES era. The VB, the modem adaptor, the BS-X, etc. All of these were before there time or just were crappy ideas. The world is ready for this idea (and probably was in the SNES era as well) and I think that with proper marketing and 3rd party support it can be a great success.
I think many of us have learned from TWW not to quickly dismiss Nintendo's ideas but to give them a chance. So I say that we just be open to the idea and let's see what the Big N has in store this time around.
Also, I can easily see this as a 3D system. Having 1 GBit media storage is completely outragous for anything but that.
[How's that for a first post!]