The good folks at iLounge believe this is the new nano from apple, fitted with a camera, at a very odd position. Rumored specs 16gb-32gb capacity digital camera 1.5:1 aspect ratio More here

Its real folks, the Zune HD is real. With an 3.3 OLED tTouchscreen, HD radio, Wi-Fi, intergration to Xbox-live and Marketplace. No word on storage, price or specs. We should hear more come E3, because of the live intergration.