I'm expecting Microsoft to try to merge the Wii strategy with the XBox 360 strategy in order to maximize their potential market share. If you replaced the A button (thumb button) with the four buttons from the XBox 360 controller, and switched the B and Z buttons with analogue triggers there is nothing that could be done with the XBox 360 controller that couldn't be done with the Wiimote and Nunchuck ... At the same time, if you incorporated the technology from MotionPlus into the Wiimote and Nunchuck there is a lot that could be done with this controller that couldn't (easily) be done with the XBox 360 controller; in particular, if you consider the IR pointing and motion controlls that are possible.
At the same time, I think Microsoft will push forward with performance but not to the same extent as they did in this generation. The XBox 360 has a GPU which is similar in performance to a Geforce 7800 or Radeon X1800, and if they take the path I am expecting them to take it would be like them hvaing released the XBox 360 with a Geforce 6600/6800 or a Radeon X600/X800 which would keep costs and energy use/heat production way down.
