Tomorrow Apple is widely expected to introduce a smaller form factor iPad. I assume it to be engineered with cost reduction as the main goal, while keeping the requirements of schools in mind. I expect Apple to want to use the A5 processor with it, and this means that it will not have a retina display.
The prices need to be competitive with the 7″ Android tablets, so I assume that there will be two models, one with 8GB memory for $249 and one with 32GB for $299, and maybe a 64GB model for $379. I am not sure about wireless, I find it unlikely that it will be supported, given the high prices of data plans, and the focus on costs. It might be added once the line will have a retina display as well.
I expect it to have similar capabilities to the current iPad, with the same camera modules as the iPod Touch. I would not be surprised if Apple would provide more color choice than black and white with this model.