Unless made for a square display, video will not be ideal on this device. Even SD NTSC content is 4:3 and would require cropping or matting. Anything modern would be tiny on this display.
I think the aspect ratio makes sense for the form factor, recipes, FaceTime, music, etc. but it won’t be a very good video device.
Yeah, and the screen is just 7 inches to begin with. I just don’t know if I would get enough utility out of this device… I think it would be more interesting if it was a MagSafe dock for an iPad and that put the iPad into home hub mode or something.