A source has told Develop that Nintendo's new console, codenamed Project Cafe, will include a front-facing camera in its pad-like controller. They say that the camera can be used for in-game images. With the already rumored touchscreen and all, this is sounding a lot like a 3DS. In fact, some are saying that the 3DS could act as a replacement controller.
“The functions are the same,” the source said. “It is a standard wireless controller added with a front-facing camera and touch screen."
The source also confirms some of the other rumored controller details, like the six-inch touchscreen and the standard button layout. A stylus is also a possibility.
Nintendo would put a front-facing camera to good use, I'm sure. If there is one, I'm sure we'll get examples of its usage next month at E3, where this console and its controller are scheduled to be unveiled.