Valve has confirmed that the "Piston" living room PC being made in conjunction with Xi3 is not the "Steambox" that was confirmed last fall. Rather, it turns out the Xi3 hardware is just one of many in-development projects that Valve is working on with other partners, while the "Steambox" is being developed internally at Valve.
So what does this mean? It means that Valve's supposed PC/console/whatever hybrid is still very much an unknown entity, though Valve's Gabe Newell has confirmed some things. Speaking with The Verge, Newell stated that "[Valve] will come out with our own [system] and we'll sell it to consumers by ourselves. That'll be a Linux box, [and] if you want to install Windows you can. We're not going to make it hard. This is not some locked box by any stretch of the imagination. We also think that a controller that has higher precision and lower latency is another interesting thing to have."
For the full interview with Gabe Newell, head on over to The Verge.