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I used my laptop running an NVidia 4200M over HDMI and the graphics were slightly better than the 360, so I'm not sure what you're smoking when you say an iconica with a tegra 2 would outperform it. If it were true, they'd be developing games like BF3 for tablets. As for 1080p, it is true 1080p, but some games drop to a lower resolution to gain framerate. The same goes with AA. The 360 is capable, but they dropped the requirement for it. Even with AA missing from games, it still doesn't have the Jaggies that the PS3 has. They're both still great (I own both), but I get tired of the sharp edges on some of the PS3 games.
I'm not trying to fuel the flames or start an argument with you, as much as just add some input on it. You're still talking about 10 year old technology vs something that's relatively new and more efficient. Regardless of the outcome, it's win/win for us on every end. We'll have cheaper toys and cheaper games, and the big name consoles will have to change their business model to compete, which usually means competitive pricing. The thing we need to worry about the most is whether those companies will pull Apple BS and start scrutinizing patents.
Another thing that may be a plus and minus is whether or not they're going to keep the programming the same across the board. With that many new mini-consoles coming out, they don't want to split up the development and kill each other off because of fragmentation and dilution. I WANT to see these guys succeed because I love games, regardless of the media they're on... BUT, I look for these to be an addition to a gamer's toolbox, rather than a replacement for higher-powered system that allows for larger titles. In that aspect, is IS apples and oranges.
Considering the price, you're not going to see people buy these smaller consoles and just quit there. Like the other guy said, the kids are still going to want the big console... whether it makes sense or not, parents buy what kids want. My kid plays on everything, and I'm currently running a 6400, Wii, WiiU PS1, PS2, PCs, 360, PS3, Genesis and intellivision in one room. They seem to like the 360 better (and my daughter likes her tablet), but there's no doubt in my mind that I'll probably end up buying a few of these things just to fill in the blanks. Will it replace the high end consoles? Doubtful.. but it's more stuff for us to enjoy, and the more that are out there, the cheaper it is.
The other thing that was the end of the Wii, which will be the demise of the handhelds, is the ease of Homebrew/Cracking. The second the Wii was easily cracked, developers quit putting effort in to it. It's not like they had a lot of power to open up their coding freedom, but that's still quite a bit of losses considering the amount of consoles that were compromised. I know the PS3 and XBox were also cracked, but the ratio was FAR less, considering nobody wants to brick their console or have it banned when they're far more valuable.
On that aspect, you will probably see quite a bit of cross-platform gaming for phones and the new micro-consoles, but you can guarantee those consoles will be cracked in a heartbeat and free APK copies will be scattered about. Granted, they're not the same as the retail consoles, but when the founder of the company touts how she wants people to hack with the console, I can't see developers putting their heart and soul into Jaw-Dropping titles that are going to produce the "wow" factor that new-generation consoles like the "720" or "PS4" will be capable of. I'm not sure what these new micro style consoles are capable of, but I'm not guessing that they'll be able to draw you into the screen and actually blow your mind with extreme detail that even current consoles do. I'm sure the shield will be able to keep up with CURRENT technology, but you KNOW when people see newer consoles they're going to be pretty speechless, especially when you can guarantee they'll probably be capable of much more than just graphics.
They WILL sell, but the lifespan will be limited. They'll sell as cell phone apps do, but don't expect kids to migrate to it, (or their parents).. when Microsoft, Nintendo and Sony have already accomplished the level of Apple in the console "status" world.
Overall, it ends up being apples/oranges. If they do sell, they'll be used for a pack-and-go console or as a side-cart console where it's fun to have around to use between other game title releases, but it will ultimately be stacked next to a more expensive console. I also can't see them carrying the power to host 20 players from the console as well, and I'm not certain that a company that's having all of its software pirated is going to want to put up servers to help them out. I guess an account-based software would work, but it's still iffy.
(on another note) keep in mind how many dreamcast consoles were sold until the CD exploit brought it crashing down. There are quite a few things to consider.