In short, Nintendo's gamble works. The controller is the best of both worlds, mixing traditional button inputs with the advantage of having an interface unlike anything we've seen from a home console.
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One of the more interesting alterations to conventional design is the system features two analog sliders at the top of the controller rather than traditional sticks. Don't make the mistake of thinking these sliders are like the 3DS "circle pad." The texture and top shape of the sliders are much more akin to Wii's nunchuk, meaning the grip and precision of movement are much better.
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The tablet itself appears large, but is actually quite comfortable to grip. The two sliders both being located at the top of the tablet make holding it considerably easier. A staggered configuration would only have worked with a much smaller design. Nintendo was also smart in making the new controller extremely light for its size, resulting in something that might look strange but is not as burdensome as it would seem.
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Nintendo played an interactive cinematic that put all my fears to rest. The difference in quality between that sequence and this was light years apart, making me wonder why I watched the hawk video in the first place.

The second major tech demonstration featured live footage of Japan, with a camera moving down a crowded street, hovering above vehicles. Like the hawk demo, the tablet was also featuring the footage shown on the television. But as I moved the new controller, I was able to see more of the city around me, without altering what was being shown on the larger screen. I could move the tablet upward to see the sky, or downward to see the street moving under me. Even more impressive, I could start to rotate the controller or "aim" it behind me to see where I had been. Pressing a button would also flip the portable display behind me, allowing me to see backwards similar to a rearview mirror. The potential for racing games with this sort of technology is truly impressive.
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I played two Mii mini-games on the new console. In a word, they are both fantastic. In concept, execution, scope and entertainment, they are leaps and bounds beyond what you experienced on Wii.
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I wasn't able to control Link, but the battle between him and Gohma that I saw was breathtaking nonetheless. Between changing the lighting, camera controls and even the tablet's display, this (Zelda) demo above all the others proved how Nintendo franchises might benefit from increased power. This was gorgeous stuff.