You might remember that we broke news of an updated Apple TV headed to market just a few months ago. If your brain isn't working right, let us jog it: a trusted Engadget source asserted that the gang in Cupertino would be releasing a $99 version of the set top box, similarly sized and packed with internals akin to that of the iPhone 4 (A4 CPU, 16GB of flash storage), and will introduce new iTunes streaming services the box could take advantage of. Well we've gotten a little more info on the project, and it's not all good. Apparently the box won't be capable of handling (or enabled to handle) 1080i or 1080p video. Instead it will only push out 720p clips. The word -- and cause for much internal debate, we're told -- is that this has something to do with the A4's inability to crank on higher resolution content, but we don't see how that's possible considering the iPhone 3GS could play back full HD video. Furthermore, the device will be getting apps and presumably an App Store entry, though it's unclear if there will be cross-pollination between iPad and iPhone / iPod touch offerings and new Apple TV applications.