Rumors are abound in the blogosphere of a possible iPhone sequel, dubbed the iPhone Nano, being produced by Apple. The main source of these rumors is from a company out of China, called iDealsChina. iDealsChina is known a somewhat credible source, having leaked information about iPhone casing designs before, but also inaccurate information, such as of the iPhone touch containing GPS capabilities.

If true, the iPhone Nano is said to be approximately twenty percent smaller than the current Apple iPhone offering. However while it would be shorter, it would also actually be slightly thicker than the current version. Also, the new gadget is said to lack 3G connectivity, a major iPhone selling-point. It’s unlikely that many of the current iPhone apps would be able to satisfactorily function on the iPhone Nano, due to the smaller screen size it would clearly need to have.

While the rumor seems a little on the hokey side to me, we will likely found out if there is any credibility to it at next month’s Macworld conference in San Fran.