Here's something I wrote two years ago:
"sometime by summer 2009, Apple will introduce the MacPad, a keyboardless tablet computer with a wholly reimagined UI based on multi-touch."
By many estimations, this is on track. All the stuff they've added to the 3.0 OS seems to make it possible to do almost everything you can do with a computer with an iPhone. Add a multicore processor, bluetooth, a plugged-in device API, and ZeroConf support (finally!) and this is getting very close to a general computing device.
Which is what I want. Only a little bit bigger.
The challenge here seems to have been to find the right balance between shrinking the mac laptops and growing the ipod/iphone. When I wrote about "MacPad" I presumed they would be shrinking the laptop. But now it seems more like they're growing the ipod/iphone. They've built up the restricted OSX environment on the phone now so that it can handle most any kind of app except for a terminal, a decent IDE, or a decent word processor. An "iPhone Pro" at 8"x5" wouldn't get quite there, but with a shape and features just like the iPhone, but bigger, it'd be just shy of that. A "MacPad" smaller than the Air in a tighter package with hideaway keys and multitouch would be just enough, but might make a crappy phone.
Like plenty of other people, I'm still convinced this is coming soon, but I'm not sure whether it'll be one or the other or both. Can't wait to find out, though.