Intel's Agnes Kwan confirmed early this morning that, in light of their split with OLPC, the Classmate program at Intel is alive and well. She noted that they are still actively working with OEMs and local developers on the Classmate. More interestingly, although she could not comment on any specs, she did say that a next-generation Classmate was expected within a couple of months.
We should have some more details on the split today and I'll post them when I hear more. Whatever the reason, Larry Dignan's classification of this as a duel is probably spot on. Let the games begin!