Question #1 - What is this Namco system of which they speak?
Almost nothing is known about the Namco system. Supposedly it was nearly complete by mid-1989 but Namco didn't know how / or feel capable of marketing it with so many new systems coming out in 1989-1990. I believe it eventually became the
NA-1 and
NA-2 arcade boards. Note their very simple, clean motherboards. Very console like, as with Sega's Mega-Tech, System C-2 and Mega Play boards, all based on the MD/Genesis.
When we look at the two pieces of "info" (rumor) that EGM provided in their next issue (#3 - August/September 1989)....
(sorry I don't have clear scans)
...We see that Namco's system almost
became the PC-Engine 2. However Hudson would have none of it. Afterall, Hudson were the creators of the original PC-Engine, so they felt threatened by NEC going with Namco's hardware instead of their own. Hudson killed the deal between NEC and Namco.
If this is true, there may have been as many as
3 different PC-Engine 2 specifications.*A 16-Bit system designed by NEC-Hudson with a real 16-Bit CPU, much improved graphics capabilities, perhaps even scaling & rotation. Improved audio/sound capability.
(This is the one they should've went with, for the later half of 1990.)
*Namco's 16-Bit Super System
renamed PC-Engine 2 with abilities comparable to the Super Famicom.
(I think this would've been the 2nd-best option)
*Hudson's upgrade of the original PC-Engine with the exact same CPU and audio ability, with only modest improvements to graphics and more RAM/VRAM.
It was rushed to market in Nov 1989. This of course was released as the
SuperGrafx with a 2nd VDC/VPD with its own 64K VRAM thus 128K in total
and 32K work RAM, up from 8K in the PCE.
I like the first and original choice best. A Hudson-designed 16-bitter that would've been a real leap forward. It could've been as far ahead of the competition in 1990-91 and '92 as the original PCE was in 1987-88. It would've easily surpassed the Super Famicom/SNES in power, and (at least) even given the Neo Geo a run for its money (no pun intended).
When combined with the Super CD-ROM/ System 3.0 card, then later, the Arcade Card, NEC-Hudson's 16-bit console would've been the 16-Bit home platform to beat. Provided the marketing got equally better and provided more 3rd parties abandoned Sega and especially Nintnendo.