According to the coast watchers over at Engadget, Apple Inc. may be getting into the gaming hardware business and then some.

Recent patent applications have requested patent protection with the code word “APPLE” “for products that classify as “Toys, games and playthings, namely, hand-held units for playing electronic games; hand-held units for playing video games; stand alone video game machines; electronic games other than those adapted for use with television receivers only; LCD game machines; electronic educational game machines; toys, namely battery-powered computer games.”

Whew. That’s a lot of protection and follows on the heels of their patent application for a multi-touch gaming interface. Which should put the Cupertino Rumor Mill in high gear this summer. Imagine the potential for wireless Xbox Live style gaming via a handheld PSP style device. Or could it be perhaps an “all you can eat” device converging the iPhone? Seems so, as the multi-touch patent states:

“the invention allows various applications to be integrated and used on devices that are not readily suitable for supporting multiple applications at the same time.”

Could it mean that Apple is once again diversifying? Will we see a handheld called “iGame” by Christmas? Inquiring minds want to know, Steve.