CAL - Interesting you mention Costco... I got my Costco catalogue in the mail today only to see they carry Gateway computers and plasma TV's. I wonder if the DMP X20 might be included at some point. That would move a few...
The Melodibox sold by Costco appears to be a version of the Xclef HD-500 made by MultiChannel Labs: http://www.xclef.com/pro03_e.htm According to MCL, it is 255 gm (9 ounces), which makes more sense than 1.2 lbs.
The Xclef HD-500 has been sold in the UK for quite some time and got great reviews from users. There is a link to customer reviews on this site (some reviews compare it to the Treo):