Apply a little logic and you shall see...
Craig - I think you'll find that Toshiba was at least as much to blame for the present "HD format war" and the refusal to agree on a single format.
PS3 is expensive. Look at the thing, it's designed to look expensive. The case itself it expensive. But that shape also forces certain things in terms of the internal design. Those in turn drive up the costs because you have to use a certain quality of component.
Let's say that the 65nm Cell and RSX are not available. Let's say that the BluRay drive can be more slimline now. Let's consider that less power will be needed if these simple assumptions (not outrageous assumptions in themselves either) are true.
Perhaps, just perhaps mind, Sony will deliver a PS3 with two rather than 4 USB ports, perhaps they will remove the flash memory reader. Throw in 65nm chips a slimmer BD drive and a drastically cut component count on the motherboard. You might even get away with a more conventional heat sink/fan design for the system if the 65nm chips are cooler. Finally put it all in a PS3 casing without the gloss finish and chrome and perhaps even only cosmetic resemblance to the original high gloss PS3 case. Sign up Foxconn to make the thing and suddenly you have a pretty decent shot at cutting the costs of production and selling your system at a much lower price.
There is no way that any PS3 will arrive without a BD drive. It's a core component of the platform. The other rumor that is doing the rounds is that they will strip out the remaining hardware for backwards compatibility, effectively dropping the PS2 compatibility completely. Sony has made so much of the backwards compatibility that I just don't see that happening. It would save them some money, however removing it would cost them in publicity more than they could hope to recoup with the cost saving. Playing PS1/PS2 and PS3 games on the PS3 is kind of a core capability and is there to stay.
Given the costs of building a PS3 though, the cost of the PS2 component in the case is actually relatively limited. The major cost items are Cell, RSX, BD, motherboard, memory and casing. With a die shrink and other maturation of production and component costs there should be some substantial cost reductions available for a reconstituted PS3.