This is the product I've been waiting for since I discovered that I could emulated SNES games on my G1. ARCHOS just announced the GamePad, a 7-inch Android tablet with physical buttons and joysticks on the side. It runs on a dual-core 1.5 GHz processor with a Mali 400mp quad-core GPU and Android 4.0 Ice Cream Sandwich, so it shouldn't have any problems running the latest games. Interestingly, ARCHOS says the GamePad comes with a patented technology for automatic game recognition and mapping tools. I am not sure how well this will work, but this technology may make touch-only games compatible with physical controls.
The GamePad is launching across the world starting at the end of October 2012 for less than $200 US.