I think you're assuming too much when you say they'd need to get exclusive content. As it is, we know a large number of PS3 owners are buying that device for more than gaming or outright non-gaming capabilities. As was said, this would probably just be an extension of their AppleTV product.
They don't want to compete in the traditional sense. They've seen MS lose billions on that path and would never follow it. But they could easily make a device that plays games almost as good as 360 quality out of a device that's already being sold as a home entertainment hub. From there they would just sell products for whichever 3rd party wants to take a shot on it. They can do ports all day long if they want, too, because the typical Apple product buyer will get the thing regardless of whether or not it plays games and then they'll buy a couple just because it does.
And people have proven that they will buy the Wii for WiiSports. If the system has any sort of new interface or motion interface, they won't have to try hard to sell the thing on innovation rather than capability. That's sorta how Apple works, ya know?
You do not have the right to never be offended.
