Let us review here, Slot 1 cartridge with Micro-SD card adapter, check! Playing or viewing of downloaded movies, tv shows, books, magazine and comics, check! Sounds like something that is already out in the market and it is called the R4DS.
This might seem like re-inventing the wheel and even though it has a legitimate/legal slant to it, the download content is not free! It's like providing a Microsoft operating system that can and will only run original software.
I would rather much have AM3 provide software to run exclusive and copy-protected content on existing Slot-1 devices such as the R4 or the M3, more of like iTunes and the iTunes Music Store minus the iPod exclusivity. AM3 is not like Apple, which enjoyed first-mover advantage with the iPod, as the R4 and its ilk are already out in the market for nearly a year. Software, unlike hardware is key here.
With the R4 already prevalent even in Tokyo, and I bet it's going to be a favourite stocking stuffer this Christmas, an iTunes like service is the way to go. Even a person who plays original Nintendo DS games like me has one, and that's to run homebrew and old-school ROMS :).