Apple engineers might be laughing because their prototype tablet - which they have likely been working on for a year - is probably far beyond the the JooJoo pad in innovation. The JooJoo pad is not bad, but it's also not particularly innovative (an iPod Touch resized to 10" would already be a better product, just to give an example).
Also, in order for the JooJoo pad to succeed, it needs strong marketing. Apple is the master of marketing, and the team behind the JooJoo pad abandoned someone who would have been an effective marketer and buzz-generator (and who gave it a great name - the CrunchPad). No matter what happened between Fusion Garage and Arrington, FG should have hired a competent marketing team to come up with a name and strategy for promoting the device.