A few notes:
1) At Games (Atari licensed this, but isn't making it) reused the Sega design most likely due to cost. The extra buttons are for system switches and the like.
2) It has been reported that while putting a cartridge slot for the Sega home system worked out, the cost is way to high for an Atari cartridge slot. Sorry
3) You can pause!
4) Frogger is a redone version of the game which will be more arcade like than 2600 like. I believe they did this with Space Invaders on previous systems.
5) Don't read too much into to msrp. The other flashbacks have an msrp of 59.99, but retail for around $40. I expect these to be available at most retailers for $40-$50 with Holiday sales bringing them down to $25 -$35.
6) You can play 2600 games off the SD card, unless they used a special chip like Pitfall II (and you do own the ROMS, right? )
7) It has a TV out, but you need to have your own cable to use it.
8) This will, for the most part, be very similar to the FB 6, except of course Frogger and they fact that there is a portable unit.
Please note that while we all would love 1,000 games, cartridge slot, better emulation, knob dials for paddle games, etc, we are in a way lucky just to get this. Companies need to make money off their products and most plug n plays no longer make enough profit to warrant their existence (That's why you won't see followups to the INTV and CV versions). In order for these products to be profitable, the costs need to be kept low and they need to appeal to the general consumer, not the hard core retro gamer. They are banking more on spontaneous Christmas gift purchases than the retro gaming community. Sad to say, but that's just the reality of it.
On a side note, I am happy this is coming out. I think the button layout will be fine! I find the layout TERRIBLE for Street Fighter 2 on the Sega due to the angel, but since system switches are rarely used, it should be fine here.
However, I may not get it, since I'm guessing I already own most of the games on the great DS compilations.