If they do decide to go with DDR3 instead of DDR5, I imagine it would be due to the costs. Kinect is definitely going to be built-in. The only reason people are worried about that is because of the Kinect experience for the 360, or rather the lack thereof; the 360 didn't really have many Kinect game, and of those few even fewer were any good. Add to that, the Kinect unit itself is worth as much as the entire console.
It being built-in is great for both the consumers and the developers, in that consumers won't have to buy another unit and developers won't have to worry about their games not selling due to consumers not owning any Kinects. For this reason, the very best thing MS could do with the new Xbox is to really push Kinect to developers. I'm sure MS will push the new console's limits as high as financially feasible, but raw power stopped being good enough when game consoles doubled as DVD players; without something new, they're not gonna get very far compared to Sony and all of the PS4's features. They need to play the game Nintendo's been playing for years now: they need to figure out how to get the triple-A developers to make games that can't really be ported to other consoles. It won't be enough for a game to just have Kinect voice recognition; there need to be games that take full advantage of the Kinect's motion sensors. There need to be games that bring out what the Kinect was supposed to be from the beginning.
MS needs to take off the kiddie gloves with Kinect and really push it as a serious platform to potential developers. Otherwise, they'll have wasted their money developing it, they'll have wasted our money for buying it, and they'll have wasted developers' money for making games to run on it. If Kinect bombs here, it will be a huge impact on MS.
Another thing they could do is to ship the Illumaroom as a standard attachment to the console, or at least make it a really cheap and readily accessible one (no more expensive than an extra controller or a first party game). When Sony unveiled their PS4, everybody was left disappointed. And despite Wii U sales right now, I'd be willing to bet real money that Nintendo won't be hurting after they release either the new Zelda or Smash Bros, which is how it's always been since the N64 (really crappy sales at first, nobody wants one, then Zelda hits stores, and everybody scrambles for a unit). If MS really wants to succeed this generation, they need to take a chance and really wow the crowd; they don't want to be likened to Sony in any way right now, and they're gonna need to brace hard for Nintendo's inevitable comeback in a year or so. And holding back on the Illumaroom is only gonna hurt that effort. MS needs to make a statement this time.
They need to pull out all the stops with their new console if they're gonna want to really hype everybody up. They need to push Kinect as a serious endeavor to both consumers and developers, and they need to make the Illumaroom affordable enough for the average gamer. Whether they will actually do these two things or not has yet to be seen, but that's what they NEED to do if they want to beat both Sony and Nintendo.