Sounds like an Apple 3G S. This Phone has everything what you mentioned except of the physical buttons and Dual Analog sticks. Which could be done with a Slide mechanic. I waited for this Iphone Addon with Physical Buttons for 2 years. But somehow noone is releasing such a thing.
Your Idea is not very far away from reality. And will be done for sure and even a lot better.
I think in 10 years we will see an Gaming device with Full HD and Build in beamer and everything you mentioned.
The PSP2 rumored specs seem to indicate a PSP2 with half the Xbox360 power.
But Sony always putted in their consoles a lot of technology. But Nintendo did the oposite. A Device like that depends heavily on the games it has. And the price. Your ideas would probably fail. In 2005-2006 there was this Handheld with GPS better Graphics then PSP Internet and a lot more. I forgot the name, the CEO made a crash with his Ferrari and splitted it up. And something was going on with Swedish Mafia I just dont know how its called but it was 500 or 600 Dollar too and failed horribly. Sony would never release a Console for this price again and for sure no Handheld.
The technology you mentioned is not as expensive as it used to be. Nokia makes such All in One things a long time. I remember playing Tomb Raider 1 on the first Symbian S60 phone was probably 2002.
I dont believe that people want to pay this much for a Handheld.
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