It's possible that Nokia wants to see how the games do on normal smartphones before bringing out gaming-oriented models, which is understandable given how badly they were stung by low sales of the original N-Gage and N-Gage QD.
This news would tend to tie in with the game "One: Who's Next?" on display at E3 2006 which featured both a conventional vertical screen mode as well as a landscape mode (although the landscape mode wasn't accelerated). Games would probably have to support two modes to begin with, as standard smartphones probably wouldn't have graphics acceleration chips, but as time goes by S60 phone hardware would probably catch up so that even non-gaming models would be fast enough to run the "gaming-oriented" mode too. It wasn't mentioned in the interview, but it's also possible that Nokia is planning to eventually add graphics acceleration hardware to all its smartphones when the price is right.
The launch of the Next Gen gaming service in Spring 2007 will be in conjunction with various phone networks through whom games will be sold Over The Air, and the games will also be available through Wi-Fi or through a PC. Interestingly, Sauter said the door was open for retail games sold on memory cards too, but only if publishers asked for it, and he expected the vast majority of games would be sold as downloads.
One thorny subject, the N-Gage name itself, will apparently be dealt with in an announcement "over the summer", and it's unclear if Nokia want to keep the name for its gaming service or opt for something different. A possible compromise not suggested in the interview might be to use a more general brand on standard smartphones ("Nokia Games" or something similar) but use the N-Gage brand on the gaming-oriented models in order to keep Nokia's existing gaming fanbase happy.