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bonzobanana said:

It's a VR visor.

Detach the controllers, slide the tablet into the visor and you have a VR system.

That's it the tablet will have the required features for VR including motion tracking etc.

Powerful enough to provide great quality cartoon graphics suitable for Nintendo games

Not powerful enough to compete with PS4 and Xbone or the later versions but it doesn't have to.

May even offer 2 player games through the hdmi connection and second controller

In power somewhere between the samsung mobile VR platform and PS4 VR but closer to the Samsung end.

Surely a real possibility for the secret sauce of NX.

Good shout! The rumours were out before but I didn't connect it with the NX being portable a phone/tablet like in form factor. Compared to the Playstation VR, getting VR on the NX would cost an additional $40 for a cheap headset. 

Nintendo would be the one company I trust to deliver really compelling VR experience on relatively weak hardware. It won't be a top tier but it will be convenient and novel.

Thinking about it, theirs zero reason for them not to do this other than lacking development resources because they're concerned with giving the NX core titles at launch.