SEGA's 5th game console
Sega was working on the successor to Dreamcast as of 1999 and 2000 but of course it got canceled when Sega made an exit from hardware in 2001.
I think the current generation Sega would've been based around the canceled PowerVR4, a full GPU with on-chip geometry & lighting. Probably 4 pixel pipelines and 2 geometry engines. It would've been released in 2003. For CPU Sega would've gone with either a single core or dual-core chip, hopefully PowerPC based, in the 1 to 1.5 GHz area. RAM would be upto 256 MB total, maybe 128MB+128MB.
The current Sega console would've been much more powerful than Xbox and NAOMI 2, perhaps 20 or more times as powerful as Dreamcast, although not as powerful as Xbox 360. I agree with 1/3 to 1/2 as powerful as 360 as mentioned. Dreamcast 2 would've been capable of 720p and simpler games could've been rendered at that resolution, but most of the games would target SD resolution. The price would be $199 and I think Sega would've made an attempt at motion controls in a conventional-looking game pad. Probably not to the extent of Wii, but certainly better than Sony's Sixaxis. The current Sega would have broadband LAN and WiFi built in, and some faster alternative to a harddrive, and a fast 16x DVD drive to keep loading times much faster than 360/PS3 (given the smaller amount of RAM combined with faster drive).
SEGA's 6th console
Of course Sega would've been working on its next console by no later than 2004, for a 2008-2009 release, using the most powerful implementation of PowerVR5 as possible, which would mean a very powerful Shader Model 5.0+ machine, much more powerful than Xbox 360 and PS3, although probably not as powerful as the current GeForce GTX280 cards, maybe closer to 4850 in power, but because of PowerVR's effieciency, it would be closer to GTX280 in practice. Sega would target full HD 1080p and 60fps unlike 360/PS3 which are geared/optimised towards 720p and 30fps Even with generally higher framerates and resolutions in practice, the new Sega would still be capable of more complex geometry, lighting and shaders than 360/PS3. Yet again at an affordable $199 price. Perhaps a $299 SKU with harddrive, and additional features. The controller would be much more advanced than the motion controller in the current-gen Sega, doing at the very least what the Wii Remote with MotionPlus does, and perhaps even more.