No one is comparing it to Pandora, you'd do well not to speak for others. It could be that they think this is unimpressive all on its own, given that they've listed several legitimate complaints. People don't really like it when new harder comes out that seems to take away more than it adds, and sticking with an SoC that was dated in 2008 is not bound to get them a lot of sales.
Having a d-pad and an analog stick (even two) wouldn't make it an "absolutely massive beast" anyway. It might make it slightly larger, but it'd mostly just push those other buttons to the bottom of the unit.
The way I see it, if GPH goes forward with this it's only a small matter of time before they're superseded in performance, features, and controls by other handhelds from Korea and even China, that may very well be cheaper as well. I won't be at all surprised if this debuts for substantially more than Wiz goes for now, even though the BOM price is probably no more than a few dollars more for the accelerometer and analog stick circuitry (the extra memory is probably a wash).