I am arguing against the form factor, not against the specs, which will presumably be uninspiring: a so-so screen and (odds are) a so-so camera on the front. I don't think tomorrow will matter much, and I doubt there are that many people sitting on the fence. They'll buy another igadget for themselves or for their family members as an addition to, not a replacement for, the larger iPad. I'll probably get one someday myself, because I cannot resist the allure of new tech, but honestly speaking, I have more devices than I know what to do with already, and like my Nexus 7, it will probably also play second fiddle to my iPad.
In other words, you assume an either / or proposition, and I am saying that people will get both. There is nothing "wrong" with the idea of a mini iPad, of course, but I think Apple was wise to stay away from it, because it is a niche market. This move looks to me to be aimed at catching potential consumers who might be slipping through the gap between iTouch/iPhone and iPad, and they probably do not expect it to sell terribly well. Like the iPod Touch, it will serve a small, but significant number of users, and it will be part of the halo effect, but won't have any chance of overtaking iPad sales (as you assert).