They have already come out and said that it most likely won't be backwards compatible, and the only way they will put a hard drive in is if Sony put one in the PS3, otherwise they would like to use flash memory similar to that of the PS2. Also, they have said they haven't decided on what size processor to use, and it will depend on what is used in the PS3.
Basically, M$ don't give a shit about games and just want to take over the market, and are worrying more about their competitors and matching their specs than making games. It happened with the XBOX, all specs and no games, and it will happen again next time around.