Have you tried this size?
I had a Nexus for while and although it's a nice machine it was too small for me.
Diminutive things attract diminutive people
This.
You realize how much of a tweener the Nexus is and it just didn't get used at all in our house as well. Now that the iPhone 5 screen is bigger, there's even less reason to use a tweener.
Now, fanboy's replies are, well, it's going to be close to 8"! Much bigger screen than a Nexus! That's fine, but it's still significantly smaller than an iPad 9.7 which is the perfect size for fitting the full web on the screen.
What I'm certain will happen if Apple releases an iPad Mini (7.8whatever") is this:
1. There will be an initial sales rush.
2. Reviews will be mostly positive: super light and well designed! There'll be a few sane ones in the mix to the order of "What's the point?"
3. After a month on the market... sales will simmer.
4. Return rates will be high for Apple average return rates.
5. Sales of iPad 9.7 will be driven higher because of iPad Mini's buyer's remorse jumping over to the 9.7. This will contribute to the Mini creating a runway of customers to the iPad 9.7 who may not have been interested in buying a tablet. In other words, it'll create a market for the 9.7.
6. Three months later, the media will be saying... what's the point of the Mini and so will some of you. Things like, "Apple just needs to make the iPad 3 with a reduced bezel and a lighter/thinner form factor and they're golden"!
7. In March of next year, or somewhere around then, Apple will indeed release an iPad 4 that is thinner and lighter than the iPad 3 with a slightly reduced bezel.
8. By this time the Mini's true colors will show: nobody really needs it. It ends up being a blunder: a me too product in a niche area of cheapskate Amazon Kindle "Hipsters".
9. People will further their criticism of Tim Cook and question his leadership again, this time much more seriously as the Mini will go down as one of Apple's biggest product blunders in a while. All hail, the era of Steve Jobs is over and Apple is doomed.
I don't think Apple will release a Mini. A smashed in the middle category tweener even with an 8" screen is still an awkward device where Apps and the web look like *****. It's not really better at anything compared to a smartphone or iPad 9.7 other than being more portable than a 9.7. But they're both portable.