Interesting. They had a bunch of rumors about a new Medievil back in July or so. It could be that, though that doesn't really fit the multi-million selling criteria, as PSL pointed out.
I doubt it's an IP from another Sony studio. The only case I can think of of an internal SCE studio working on another studio's IP was Cambridge bringing LBP to PSP, but they were pretty involved in getting Media Molecule set up engine-wise on ps3, so they had a hand in the IP already.
That and I don't want them working on another studio's IP. Getting another studio to work on an IP they haven't created has less than stellar results more often than not. You need the original creators of an IP to help it really shine. Otherwise, the focus is on captivating what made the original game special (ie, copying the game to a T - a problem with numerous PSP games) rather than taking the formula and making it even better through innovation and imagination.
Whatever they're making, I can't wait to see what it is. SCE Cambridge are the tech gurus of SCEWWS, providing assistance to both third parties and other first party studios, so whatever they make should really show off what the ps3 can do. Only Naughty Dog and their involvement with the Ice Team could probably best Cambridge, despite the fact that Cambridge hasn't actually made a full ps3 title yet.
The studio also had a decent hand in Heavenly Sword's development. Mostly backend stuff, like engine development.
