The original iPad is still quite new, and now just debuting many places around the world. Many people are just getting their hands on it for the first time as it reaches more countries and production meets demand.¬†Yet, the rumors of Apple launching a second smaller version just won’t die. Today, we’re hearing rumors from China that the 7″ iPad is now “a finished product.”

According to Shanzai, relayed by 9to5mac, the device’s design will be much closer to the current iPhone 4 and will also feature both a back and front-facing camera. Interestingly, they also state that Apple is circulating at least five other iPad prototypes to protect them from leaks.

No mentions of a Retina display, but this kind of resolution is probably not coming to our iPads anytime soon. Imagine the powerhouse of a processor it would take to produce four times the current iPad’s screen resolution in a mobile device. It would probably cost a fortune too. Even going to a 7″ display probably wouldn’t solve the problem.

The idea of a 7″ iPad is tough to swallow. It is definitely an interesting form factor, but it would be very surprising to see Apple go that way. Apple probably doesn’t want to have two iPads in their product line. Having people decide between a 7″ model (better for one-hand holding and reading) and a 9.7″ model (which is better for movies and entertainment) would be very confusing. They could simply replace the current model with a 7″ version. If you consider they just proudly announced having 25,000 apps for their current model, this doesn’t seem credible.

Also, it would be very problematic to have developers create apps for yet another screen size. Of course, you can rescale, but apps are more than just pixels, there are also interface elements that need to be placed at precise positions. A new form factor would change the dynamic completely.

Some people believe a 7″ iPad would allow Apple to have an even stronger position in the tablet market and grab a bigger piece of the pie. For example, Samsung is close to launching a 7″ tablet, and Apple might not want them to have that niche to themselves.

I don’t think a 7″ iPad is going to happen, but as usual, we never know.