Where is the information coming from that it's ARM? I didn't see that information on any of the live-blogging sites. Did someone mention it in the Apple presentation?
I find it odd that Apple bought PA Semi who were apparently working on a variant of the Power architecture and had them stop what they were doing and switch to implementing an ARM.
Occam's razor doesn't apply the same to the hardware equation.
If the architecture is ARM, it would mean that Apple bought PA Semi for the purpose of getting them to dump their main architecture, which was the whole reason they were created, and got them to switch over to ARM and develop, fabricate, and test the chip in the span of a about a year.
I'll place my bets on Power architecture + ARM emulation/JIT/whatever or iPhone App recompile for the iPad.
I considered emulation, but it's very hard to imagine that a PPC running an ARM emulator could be more power-efficient than the best ARM. Keep in mind that the PA Semi team has previously designed ARM, MIPS, and PPC processors; I don't think they have any particular loyalty.
I find it odd that Apple bought PA Semi who were apparently working on a variant of the Power architecture and had them stop what they were doing and switch to implementing an ARM.