1 - "As if they are planning to get rid of the sku all together"
Even if this was true, it doesn't mean what you think it means. It could very well be a Super Slim.
Again, assuming they are indeed trying to get rid of the SKU.
2 - "The PS4 is as hot as ever".
Well, the day where it's not as hot had to come...
"Why decrease expectations of the PS4?"
Again, everything that goes up, will eventually come down; Also, maybe because they know that their SW won't be as strong, where, for instance, Switch's will.
3 - "Yet what the rumors also say is that the sent out Dev Kits are not all that more powerful than current gen specs."
Portables aren't more powerful - or even equal - to the home console.
Why? Because of battery life, for example.
Switch lasts about 3 hours with a game like Zelda. How long do you think a PS4 portable would last on a more capablade HW than the PS4?
Not to mention the price of the thing or even size - to incorporate a larger battery.
"I imagine that the device would be digital exclusive actually."
PSP Go failed because the gaming market wants games on their hands, and it still does.
A digital only portable would be really DOA.
The market just isn't there yet.
You are reading to much into what is (not) happening.
