I understand where they are coming from with the name, but the problem is that it's going to confuse people as it simply looks like a revision, or the way that they showed it, a new Wii controller. I think what they are trying to do is as follows.... that they called the Wii the Wii because it was all about family interactive fun with many people having fun together. Thus We. Now, that's not of much interest to your spotty semen stained teenage emo sat in his darkened bedroom calling people shitcock niggers over his headset in COD, because such a person is clearly not interested at all in spending time with his mum and dad waggling a controller around in the living room, he's interested in wanking and calling people that he doesn't know shitcock niggers. The Wii (we) part for him is already covered, it's the people he abuses online rather than his parents and little sister that eat marshmallows and have fun together downstairs well out of the way.
So, Nintendo decide to go after the You, a console experience for You, thus the U where you can do all of those things locked away with a controller on your own. However, they can't get rid of the We because that would alienate their cash cow market. So they try and go for both worlds at once. The Wii (we) and the U (You), which is going to cause all sorts of confusion, even with the game developers, because you're going to get games that need the Wiimotes and don't work with the U controller, and then get games that work with the U controller and not the Wiimotes, so even more bits of plastic spread around the place that you have no space to store them in. You'll have this U controller, 4 Wii motes, a balance board, a Mario Kart wheel, and god knows what else. You could probably pack a cupboard with this stuff.
As for product differentiation, they should simply have called it the Nintendo Yoo (small print - Wii capable).
