Probably not. Do people really want to carry around something that's not pocket-sized and can't run general purpose software? Probably not. Do developers want to write an iPhone app AND an app for one of these? Probably not.
With no software, this won't work.
Besides, why pay the Apple tax when all you need is a web browser anyway?
I can't think of a better time to pay a premium for excellence in user interface design than when my physical user interface is constrained.
$1M/day in sales at the iPhone app store (august data) suggests people want more than a web browser on small devices.
I don't think Apple would sell a "badly wounded MacBook", I think they'd sell a "premium communications solution"... either way it would be the same hardware.
The general purpose software problem quickly goes away when we consider online apps like Google's suite and whatever webversion of iPhoto, iWork etc Apple would come up with. Developers may not want to write apps for both an iPhone and a netbook, but they will if that's where the audience is.
Look, it's very simple: iPod Touch. Sure, it isn't a "netbook", but it is a relatively cheap device running a stripped-down Mac OS X optimized for a smaller screen and "cloud computing" without cannibalizing higher-end sales, while having an ecosystem of third-party apps though an Apple-controlled store. Can I have this guy's job now?
Why would Apple choose to further fragment it's product line by entering a segment that their CEO has specifically said they aren't going to enter, when they could just continue selling devices with much of the same functionality in a market where they have no significant competition? Because of a larger screen and a keyboard? Oh please.
It probably behooves the larger PC OEMs to get on the bandwagon because they compete much more directly with ASUS, et al. in that they sell systems that run the same software, but meanwhile, Apple is selling scores of perfectly capable network computers to people who still think they're buying a music player or a cell phone.
Why not make a docking station for the iphone. (I saw it on a blog a while ago but I think it was just photoshopped or something)
So it's a screen and a keyboard, and your iphone pops in somewhere for the guts of the computer. You even use the iPhone screen as the touch mouse. I bet people might pay 300 or even 400 for that.
I think what you saw was a patent application, and while the drawings were of a laptop-sized device fitting into an iMac-sized device, an iPhone-scale system would be more likely to see the light of day.
I'm wouldn't hold my breath, though. How large a display can the iPhone/iPod drive? How to justify the cost for something that is not a primary computer? What happens to your phone functionality? What about the accelerometer? What about rotation, as most apps are designed for vertical orientation? Wouldn't using the mouse as an input device be redundant? Would emulating touch control with the mouse (like the simulator) be adequate? Wouldn't it be cheaper to just add Bluetooth HID support and hang a magnifying glass in front of it? Etc, etc.
Gruber does a pretty good job of calling this one what it is: bullshit.