One of the things that motivated me to take the jump to Micro Four Thirds was hearing the rumors from fairly plausable sources that Nikon was making a mirrorless camera with a sensor smaller than the 4/3rds sensor.... because I think that the 4/3rds sensor is about as small as you really want to go.

So it's interesting, in that it will probably cause the other players to improve, but I think Nikon is working too hard to make a SLR that deliberately doesn't compete with their dSLR lineup. It kinda reminds me of the Nikon Pronea SLR series, actually.