4G iPod nano rumored to have GPS (updated)

Is this the much-rumored fourth-generation iPod nano?

On Friday Digg's Kevin Rose posted a rumor about a "revamp of the entire iPod" coming in the next 2-3 weeks. In addition to iTunes 8 and iPhone firmware 2.1 Rose predicts that the entire iPod family will receive "fairly large" price cuts, the iPod touch will receive cosmetic changes and the nano will receive a significant redesign.

Rose doesn't reveal the source of the above photo of the alleged nano, but it's interesting in that reflects a change to a larger screen and a return to a taller form-factor reminiscent of nanos of yore.According to TUAW Chinese accessory maker Beelan has already whipped up a silicone-type case for the mythical 4th generation iPod nano that matches its sleek curved face and long, franken-pod looking shape.

Does Beelan also know something about this as-yet-unannounced iPod nano or did they simply mock up a case based on the rumor pic that Kevin Rose posted on his blog? If so, damn! that was fast. Update: Rose's rumor track record: 3 right, 2 wrong, 1 part right.

Apple has held media events at its Cupertino campus in September for the past two years and is rumored to do so again next month, so new nanos are certainly possible. But then again so is iTunes Unlimited, The Beatles iPod and the tooth fairy.

What do you think? Fact or fantasy?

Update: MacRumors quotes iDealsChina as saying that the updated nano is rumored to have GPS. Ok, that's a bit of a stretch, but then again, it does have a suspiciously larger screen... Hmm.