Entitled "Advanced Sneak Peek of Apple Hardware", this pic is a small crop of a photo on Anil Dash's Link blog posted today. Anil says: "this tiny handheld device will revolutionize portable gaming". Hmmm... Maybe there is something to the rumor afterall. Looks like a little notebook with modem and ethernet ports in the back except smaller and narrower. I would rather it be wider than taller, but cool!
UPDATE 2-13, 11 am: On second thought, Anil is an avid PC user and perhaps this possibly doctored pic (the Apple logo looks funny) is his idea of a joke. Also the black *heavy* design would be a departure from Apple's current design standards. Not impossible, but unlikely. Foiled again! :-(