What bothers me the most is their belief that "Real Games Need Real Buttons". On the contrary, game devs seem to be doing perfectly well without buttons on smartphones, and customers don't seem to be complaining either, judging by the success of touch-native games like Angry Birds, Tiny Wings, Flight Control, Cut the Rope, etc. You might think that these aren't 'real games' but that's a remarkably narrow-minded opinion.
Regarding the price: the $42 coco is described as being "less than stores" which suggests a ~$50 price tag. If you got a few games for free, that'd be OK, but otherwise it's very steep.