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Sounds daft... the Kinect device is already big, and it has to be able to move around slightly if I understand it correctly. Trying to put the next gen Xbox in the same unit as the Kinect tech is ridiculous.

It might be possible in a year or two to have an X360 and Kinect incorporated. X360 tech is probably old enough now that it would be able to fit into a relatively small case and still run cool, though it would have to be without a disc drive.