I think $249 would be a big mistake. When people see these things in Kiosks, side-by-side with Xbox 360's it'll be pretty easy for that magical "average" consumer to not say, "Wow....for only $50 more I get the one with way better graphics?" I mean, seriously, if they've got Red Steel on one the Nintendo Kiosk and Gears of War on the 360, Nintendo needs that person to say, "Well, yeah, but that thing is way more expensive," and fifty bucks ain't gonna do the trick (the price diff. between $250 and the core Xbox 360 package).
They will sell through the initial six million projected to be shipped through March '07 at either price just because of all the hardcore gamers who are excited about it. But $250 is not going to cause non-gamers to buy this thing in droves.
I'm getting it either way, of course, but I'm probably not nearly as hard a sell as non-gamers.