The reason that Palm sales are down is because they have nothing new to offer. There is no "must have now" feature. My 4-year old handspring performs just fine, and I have no need for a bulky combo/phone/PDA (yes even the 650's are bulky compared to my phone).
However, I would jump tomorrow to replace my PDA if I could access the web and particularly hotmail, gmail, etc. from any wi-fi hotspot like starbucks.
Adding WiFi to all new Palm's is a no-brainer, particularly if they can partner with a cheap WiFi service (i.e. not $40/mo like blackberry). It should not be hard to do by bundling with existing service as sprint already sells web access as an add-on to phone service. Yes, I know they have the Tungsten, but most of us are not going to pay that kind of money for a palm just to upgrade and then some huge monthly fee on top of that.
It is obvious that they just don't get it at Palm. Which is a shame as I would prefer not to be stuck with Windows CE units when Palm craters.