New hybrid Tablet PC/eBook reader on the way?

We’ll level with you: the Tablet PC hasn’t exactly been the massive hit Microsoft hoped it would be.
There’s plenty of blame to go around (pick your pet theory: that people simply don’t want to write by hand anymore, that Microsoft made a mistake by charging OEMs more for the Tablet PC OS than for the regular version of Windows, that everyone did a terrible job at marketing these things, etc.), but there’s speculation that Redmond is getting ready to take the wraps off some sort of hybrid Tablet PC/eBook reader that’s about six inches by eight inches in size (no pics yet, that’s just a generic Tablet PC pictured at right).
Sounds a bit like other mini tablet-style PCs we’ve seen, like Sony’s Vaio U-Series, but apparently these new hybrid tablets will use the same active digitizer technology found in regular Tablet PCs rather than the more traditional touch screens. Assuming this is for real (and it sounds like it is), Microsoft Watch seems pretty sure that Microsoft will be showing off a prototype during his keynote at the Windows Hardware Engineering Conference on April 25th.