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I don't think it's real, even if it was I don't think I'd want one. The current ipad size is about as small as I'd want to go with a tablet (although thinner/lighter always valued). Although there's wiggle room if the aspect ratio moved more towards 16:9 than 4:3.
The only reason I like eInk devices to be midway between phone and tablet size is that the phone is a little too small for long reading sessions and the extra space of a tablet doesn't add anything for fiction, that's only useful for certain reference books or apps etc
tl;dr iPad doesn't need to become smaller, just lighter imo.
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