As far as using classic games, these would be my picks:
-Bubble Bobble
-Double Dragon
-Doom (Most Wanted)
-Pitfall Collection (Pitfall, Pitfall II)
Maybe you could make special editions of those or something. As to new/homebrew games, I would suggest getting some games from the makers of the AVS. If you're looking to expand and include your own Prometheus exclusives, why don't you release the code format or a compiler and hold a contest? Maybe the winner could get a prize of a sort, and game and its properties would become yours, and you could sell them alongside the Prometheus as launch titles. Letting wanna-be developers know the type of code is essential.
UPDATE: Also, with the hardware, I would like it best if there were 2 main controller types: Keyboard and Pro. The Keyboard would be similar to the ColecoVision controller, but with higher quality. The Pro would be a D-Pad with 6 face buttons and 2 triggers. This would allow for developer flexibility and ease of porting. For hardware, I would include 4 controller ports, HDMI support, and all the typical things. Maybe you could create an online modem later??? That would DEFINITELY be interesting.