I'm playing Wind Waker, so right now I personally couldn't care if Twilight Princess ever comes out. I'm quite content. Although I'm certain that'll change once I'm done. Actually, I'm glad TP got delayed, because now I can't get distracted away from Wind Waker by it.

Overall, I think this is going to be a great thing. I'm not a fan of "keep the game in limbo because you can always make it better", but Zelda games have been having a diminished impact lately, so trading some quantity for quality seems like a very good idea right about now. Zelda needs to be awesome.
Twilight Princess launching in line with the Revolution launch? Okay, that's just brilliant. Sure, Nintendo needs to take care of their GameCube owners, but I don't think this dealy is going to kill anyone who wasn't dead already. TP might've moved some GameCubes, or gotten some people to dust them off/dig them out of their closets, but it can still do that after a delay. And moving Revolutions is a much better idea than lost-cause GameCubes.
Combat the Xbox360? Meh. I think the best way to do that is to focus on doing the Revolution right, not by getting into a fight. Remember what happened when Nintendo put Metroid Prime 2 up against Halo 2? I don't think Nintendo should retreat, but they should definitely pick their battles.
TP is going to be like Link's Awakening DX on the GB/GBC. Or the Oracle games on the GBC/GBA. Right in the transition phase. It's an exciting place to be.
The Oracle games had some GBA extras, like the Advance Store and some extra rings. Someone mentioned stuff like bonus costumes and weapons for plaing TP on the Rev? That's a great idea. Provided that the version on the GameCube has a healthly amount of those in the first place. You shouldn't leave a group of people "wanting more" from a game. Fortunately, "giving people what they want in abundance" sounds as if that's TP's entire philosophy. I just hope Nintendo can pull it off, because that's not usually Nintendo's philosophy.
Link's Awakening DX had color on the GBC. So now the question is... what is the Revolution? Does the Revolution have something so awesome that it will make current-generation console games look as out-of-date as if they were black and white? And because of the delay, Twilight Princess will be programmed to be able to take full advantage of it?
I'm officially hyped for the Revolution.