Well, since the system is designed around similar architecture to the GBA, the earliest games will just be ports of existing GBA titles, but with some second screen functionality tagged on. I really can't see this competing at all with the PS1 and PS2 ports that will be on the PSP.
I'm sure that some games will be totally unique and that is where they are trying to put it. They want it so that other game systems can't even come close to offering the same kind of gameplay. I just don't believe that a second screen and a stylus is going to revolutionize gameplay.
It's interesting that they mention that the DS has more processing power than the N64. It also has a lower resolution, so there are possibilities for a great Mario DS.
I'm gonna wait and see. I'll probably get both, but I just can't imagine that picture being the final design. It is just too "prototype" looking.