This is not exactly a rumored device, but it SHOULD BE!
I completely understand that the Nexus line is not supposed to sell, instead be a guideline.
But come on Google, you have a following. Take us under your wings.
There should be a flagship MP4 Nexus device to act as a guideline as well, which I personally dubbed Nexus "Play".
There are Android MP3/MP4 players out there but not one sporting the Nexus brand.
This ends my rant on the Nexus "Play". :p