Technically it is possible they would simple have to alter the way content was delivered and lose the HD movie playback capability. Obviously from a Technical standpoint only a Blu Ray drive is going to play Blu Ray content. It is exactly for these reasons why this cannot happen and why this is not realistic.
A Blu Ray drive on the 360 is realistic even if it is unlikely. No technical reason why a Blu Ray capable drive could not also playback DVD9 discs. I think the flagship system will also maintain its price point and for that reason will always contain premium components which I still think will eventually mean a Blu Ray combi drive and WiFi and all the other missing components.
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Technically it is possible they would simple have to alter the way content was delivered and lose the HD movie playback capability. Obviously from a Technical standpoint only a Blu Ray drive is going to play Blu Ray content. It is exactly for these reasons why this cannot happen and why this is not realistic.
A Blu Ray drive on the 360 is realistic even if it is unlikely. No technical reason why a Blu Ray capable drive could not also playback DVD9 discs. I think the flagship system will also maintain its price point and for that reason will always contain premium components which I still think will eventually mean a Blu Ray combi drive and WiFi and all the other missing components.