If there's anything true to this rumour it just further proves that Canon is working on a smaller camera with interchangeable lenses. Though I doubt it will be mirrorless. If Canon wants to do it right, they should use EF and EF-S lenses. One of the problem with most mirrorless systems is that the lenses cost a fortune for something that most people either use as an upgrade to a point and shoot giving a bit more freedom or something that's smaller than a DSLR so it gets used a secondary traveling camera.
For example, Nikon's 1 series doesn't seem too attractive, the sensor is too small, there's little point to use a 2.7 crop factor with Nikon lenses and the body isn't that much smaller than a small DSLR. Not to mention that a lot of these camera aren't really pocket sized, oddly shaped and fragile with their zoom lenses.
What I see Canon coming out with is a diminutive DSLR rather than a mirrorless. Look at the Rebels, they're not that big. If the camera is going to use an APS-C sensor, it will still need the same distance between the sensor and lens. Might as well keep the mirror in there. Sure you could make smaller lens that go in a bit more but it could be possible to make quite small pancake lenses for EFS or EF mount. By keeping the mirror, the viewfinder would be much more pleasing to look into and it focus faster. (I'm not sure if the cost of the mirror system offsets the eye-piece display price)
To make it smaller and cheaper, deliberately cut corners. Give it 8-10 Mpx. There's no real need for more. It's not like this is the kind of camera that will get endlessly retouched to do a Vogue cover. With the lower pixel count it should be able to do very well in low light. Which brings me to my next point, with low light capability and being marketed to be used with a new set of fast pancake primes, ditch the flash. Might as well ditch most of the auto-focus system as well, just keep one cross type in the middle. With a simpler camera, it wouldn't need that fast of a computer and might be able to give it a smaller battery too.
TL;DR I think Canon should look into making a smaller and cheaper APS-C DSLR by sacrificing features in order to compete with mirrorless cameras. Other than being a bit larger, it would have an edge over mirrorless in many other aspects (focus speed, sensor size, low light capability, lens selection, view finder, metering...).