Fruit Cake,
This, in my opinion, is the exact reason they'll do it. THE 7" option with cameras. Obviously, the FT cam will be there on the front as it's now ubiquitous across all devices---iMacs, iPods, MB and MBPs, iPads, iPhones...I'm confident the front cam WILL be there. BUT...the wild card, and the thing that may put the iPad offering over the top (of the competitors 7" offerings) IS that back/5 or 8 mpxl camera. I think I read somewhere on the iPhone or iPad builds that the camera was under $10 US. In my opinion, this will allow Apple to charge $299 for it, an extra 50 over the closest competition.
Again, just my humble opinion...but it's surprising how many photos are there on Flikr and other sites that give the 'brand' of camera used to capture...using the iPad. Those of us that frequent this site are certainly more gadget oriented and may choose not to use the iPad as a camera....but it IS being used, and in a 7" form factor it's less unwieldy than it's older 9.5" brother. Less heavy as well. I've owned each iPad and I can remember firmly believing that Apple would NEVER put a 'back' camera on the iPad (from the original to the transition to the iPad 2)...but the second generation model came out, albeit with a crappy camera and definitely surprised me
I just don't think they'll leave it out...especially considering the market and competition. They'll likely be able to swallow that 32% profit margin vs. the 35% (without camera)...and again, dominate the 'space' for tablet computing.
All again, just my opinion. Although I'm not so sure I believe Apple is going to release a 7" model yet. Obviously the scuttlebutt is that it's happening or being tested...but as we've seen in the Samsung trial pics that have leaked--LOTS of products they've designed, produced and tested have yet to see the light of day...and this is only in the phone segment of their product population. Imagine how many iPad prototypes are in Jony's cellar?
J