I wasn't saying that the hardware would be irrelevant, it will need to be tied to the software, and could not be done with a separate set-top box (or at least Apple would not want to do this and consumers would not be willing to pay as much for a little box as they would for a full Apple designed television), however the hardware would not need changes very often.
I'm sorry, I must have mis-communicated in some way. I didn't mean to imply that a new

TV should be priced the same as a whole television with a built-in

TV. You are correct that consumers would not want to pay as much for an

TV as a whole TV with an

TV built into it.
And you are right that (hopefully) the TV itself will not need changes very often (but that's one of the weak parts of the concept per all the other hardware that Apple seems to like to sell with short upgrade cycles).
What I think you might be misunderstanding is that if the gist of the advantages of an Apple Television is pretty much in the software alone, then that same software could be made to run in a separate box we could attach to the HDTVs we already own. No one needs to buy a whole new TV for just software-based benefits- just give us a new

TV with that software. A benefit like Siri could be built into an

TV just as easily as building it into a whole Television.
I don't want to have to go out and buy a whole new TV as much as the next guy (I already have a nice HDTV), but if Apple can revolutionize the offering of content and give users features they have been wanting in a TV for years, then I may strongly consider it.
Of course, but that "revolutionize the offering of content" is a whale of a condition. In speculating how they can revolutionize it, there's practically no scenario that requires a whole Television over a new

TV (because content is just software). That revolution also comes with all kinds of issues- some of which I've probably referenced in other posts within this thread.
"Features users have been wanting in a TV for years" is another whale of a condition. What features could those be? If they are software driven, why do we need a whole new television for that? If they are hardware-driven, that can support considerations for a new television, but then what could hardware-based features like that be? Everyone speculates software benefits. Hardly anyone seems to come up with something hardware-based that can't be covered via a new

TV
Unfortunately, I see the bulk of an Apple Television proposition coming down to some of us wanting a pretty case with an Apple logo on it... or esthetics (not liking cables or little set-top boxes). Almost everything else that people throw around about this dream is simply software (content, apps, UI, cable-killer subscription, Siri, etc). All of that software can be delivered in a new

TV that can be hooked to any size, shape, color, screen type, branded, etc television to be built in the next few years or is already in our living rooms.
The separation of Apple software (via

TV) from Apple hardware (this hypothetical television) just makes this a mess compared to other Apple stuff. If we could buy OS X or iOS and run them on anyone's hardware in an Apple-endorsed way, would we be as tempted to pay up for Apple's hardware? That's what we could have here- an Apple Television with a next-gen

TV built in (probably entirely made by someone else- like Samsung, LG, Sharp, etc) vs. the exact same Television hardware sold by whoever makes it for probably hundreds less. Pair the latter with an

TV and the exact same software experience is realized... for (probably) hundreds less.
In this way, this hypothetical product is unlike all of the other major "next big things" before it. Macs came locked with OS X. The OS for iPods were exclusively for iPods. iOS was exclusively locked to the iPhone & Touch. iOS was then expanded but still locked to iPads. But this "next big thing" could very well come out with its software also available in a cheap, little set-top box too. It's one big reason I think the rumor is false.