Just hearing this news today. Very neat idea, and makes sense for Nintendo I think.
A few things occur to me...
I wonder if touch-screen gaming will be part of the handheld experience. I imagine it will. But if you have to put the screen on a dock to use it as a console, how do you control those games in that situation? Maybe it has a sensor bar like the Wii, and you can aim at the screen with the controller parts. An interface like that could simulate touch and multi-touch reasonably well for most basic applications. It wouldn't be sufficient for all games, but it might work well enough for games designed with it in mind.
Will it have Android built in? Or maybe some specialized Nintendo version of Android, kind of like what Amazon is doing with the Fire? If so, then you could take the handles off it and just use it as an awesome tablet with a really nice graphics chip. I think Nintendo would be dumb not to leverage it that way. The machine would instantly have lots of additional appeal.
200 -250 bucks, awesome handheld gaming, very functional TV gaming console, and a cutting edge tablet, all in one package.