With PSM there is no need for Sony to use Android for the Vita. PSM is almost an identical platform. If it won't receive new apps as is, Android developers can easily port over the apps they made for the Android Marketplace. Come next year, PSM will start to look impressive. (70 titles expected by Christmas and PSM is still in beta, after that new titles will explode in number)
If someone wanted right now their Vita could be a phone, though expensive. Through Skype you can have a number for a fee and while you can keep it a wifi phone, you could always also pay the AT&T data plan to ensure you have more constant phone availability. I'm not sure how effective the Vita would be for this since you would need to always have your Skype app running, which would drain your battery and maybe time out the app. The wifi phone option utilizing voice mails is probably the best route for this. Essentially it would be like having a speaker only phone unless you used a headset/headphones. It is impracticable but possible.
Making the Vita a slider causes some problems, or more like trade offs. One, the analog sticks would have to be traded out for circle pads, like in your picture, because it is very doubtful they would engineer a friendly solution to keep analogs. Two, the back touchscreen.might be difficult to keep. Though if the bottom part of the slider was enough out of the way it could be possible, despite becoming harder to utilize than the current set up. Three, the gyro use will be less fluid because of the way you hold it. These are probably decent trade offs for someone who wants only a phone to carry around while still being able to play a full dedicated systems worth of games.
If battery life could be extended by reducing power consumption and the internal parts can shrink considerably to avoid the phone being as thick as a sandwich, then a Vita phone would be pretty nice. I'd get one if I don't have a phone by then. They should just avoid putting Android on it and make sure they maintain that 5" screen.
Before the PS3 everyone was nice to me :(












