Jay, I'm right there with you on the Neo Geo Pocket comment. This is the second time Sony has tried to co-opt a widely used abbreviation of another platform for a new product (the first was when they named their PS2/DVR hybrid the PSX, the standard abbreviation for the original PlayStation). Hopefully Sony will unveil the real name sooner rather than later. I guess they don't want to call it the PSP2 since that has a "2" in the name while the 3DS has a "3" in the name (in the same way that Microsoft had name to its second console the "Xbox 360" instead of the "Xbox 2" in order to compete with the PS3). I'm going to continue to refer to it as the PSP2 untl Sony comes up with a final name.
Anyway, I think the PSP2 looks great in the same way that the PSP looked great before it was released. As a piece of tech, it looks somewhat more appealing than the 3DS; after playing with an iPad, I'm a firm believer in multitouch over having to use a stylus. That said, it seems less portable than the 3DS due to its larger size and the two analog sticks on the front which means you basically have to have a case for it to keep the sticks from getting caught on things. You also probably don't want to get crap on either of the system's touch panels. Since the 3DS folds, you can just stuff it in a pocket. It's also kind of sad to see battery life becoming less of a priority for both Sony and Nintendo. Nintendo says 3-6 hours for 3DS games played with the 3D turned on, and Sony is saying the PSP2's battery offers playtime "similar to the original PSP" which puts into the same range as the 3DS.
As others have mentioned, I think Sony may be overdoing it. Didn't they learn from the first PSP that outside of Japan, there isn't much of a market for console-style experiences on a handheld? How are developers going to justify the development costs for games? Will it be like the PS3 and 360 where only major releases hit retail and all the cool stuff is relegated to the online shop (which is not necessarily a bad thing if the shop is done well and you can transfer content when you upgrade)?
To answer Avatar's question, retail releases will be on a proprietary flash card format that can hold more than UMDs. One of the articles I read pointed out the irony of Sony going back to a cart-like format to compete with Nintendo after famously decimating Nintendo with the CD format during the 32/64-bit years.
I'd also be pretty excited about a game experience that could be transferred seamlessly back and forth between a console and a portable as The Miker pointed out that Kojima claims to be working on. Of course, this is something that's been loosely promised as long as their have been hardware manufacturers that make both consoles and portables, and it's yet to be realized in a meaningful way, so I'm not exactly holding my breath.
To answer Ashely's question, portables most certainly have killer apps, though not always at launch (just like consoles). The Game Boy had Tetris, the Game Boy Color had Pokemon (Red/Blue were regular GB games, but their U.S. launch was timed to give a lift to the GBC which saw release a few months later), the DS had Nintendogs, Brain Age, and New Super Mario Bros., and the PSP has the Monster Hunter games (these are killer apps in Japan, if nowhere else).
Finally, there's still the big question of price. I can't imagine this selling for less than $300, though I suppose Sony may work out some deals with the cellular carriers to sell the 3G SKU at a discount when bundled with a data plan (Sony has confirmed that outside of Japan there will be multiple SKUs like the iPad and nook where you can choose whether you want 3G capability or not).
