Will the new system be backwards-compatible with Nintendo 64, just like Playstation 2 is backwards-compatible with all original Playstation games?
There is no chance whatsoever of there being backwards-compatibility. The main point is that the new system uses specialized DVDs (click here to see a picture of one) which can hold up to 1.5 Gb (1,500 Mb), while N64 cartridges only hold up to 64 Mb. Nintendo is also trying to keep the price of the system as low as possible and they decided that this feature just isn’t necessary. Forget about it!