As a close friend cautioned me recently (though re: digEplayer and what he uses on his flights); the type device you allude too, with actually more features/capability than you allude to, is already available. It`s called a notebook or laptop. And they`re available at pretty reasonable prices (~$700; saw one ad today for one with DVD R/W and 200gig drive for $999).

Need to focus more on just one function in a handheld where we could dominate. That being the ability to play SECURE content. All the other stuff you allude to could be bundled, but the key is security and lightening-fast downloads, along with battery life. JMHO. But this is where we could potentially shine.

SGE