On his weekly 5by5 podcast with Dan Benjamin (The Talk Show, episode 86: “Well-Intentioned Scumbags”), Daring Fireball‘s John Gruber got back to discussing the oft-rumored iPad mini. If you don’t have time to sit through the program’s two-plus hours, iDownloadBlog has you covered. Here’s the distilled, Gruber-quoting gist:

“What I do know is that they have one in the lab, a 7.85″ iPad that runs at 1024 x 768. And it’s just like the 9.7-inch iPad shrunk down a little bit. The apps wouldn’t need to be redesigned or recompiled to work on it — it’s just the iPad smaller.”

To clarify, he goes on to say that he’s heard from “numerous people that it’s one of the ideas that [Apple] is noodling with.” But he has no idea when, or if, Apple plans on shipping it.

Of course, Apple is notoriously secretive, and it’s not surprising that even an insider like John Gruber isn’t yet privy to the company’s complete iPad mini plans. With an expected release date somewhere in Q3 or Q4 2012, there’s still plenty of time for Apple to finish its tests and get ample stock assembled and shipped in time for the spendy holiday season.

Many of us at AppAdvice believe the 7.85-inch iPad mini is a foregone conclusion, and today’s insights do little to sway us from our stand.