No, the 360 S Turbo would be a new platform if it has more powerful hardware. The Wii is a different platform as Gamecube despite having the same hardware, just Wii 50% faster.
Wii had a new controller that required made forward comparability difficult.
If the Turbo has 6 - 8x the power of regular 360 then developers would be all over it making games specific for it. It would end up getting its own exclusive games.
I am pretty sure most developers, and MS first party would make 360 games first and up-port for the turbo. Most developers would not ignore the 70 million install base, and even if they make a game that takes advantage of the increased hardware power, there won't be enough increase to differentiate it from 360 games run up resed, unless they decide to make a 720/30 game. They'll also be prohibited by MS to make the game specifically for the turbo, both policy-wise, and API-wise.
It segments the market because Microsoft would then need to support two platforms once Durango is released. It would also add confusion amongst consumers because they don't know where MS is really headed. And it might just piss a bunch of devs because they will see two platforms with decently powerful hardware from the same company and may also wonder which direction MS wants to go.
Is MS going to support 360 once Durango is released? If they were planning to support to the 360, they'll support the turbo.
I think 360 bundles with Kinect segmented the market far more a 360 turbo would ever do.
The only risk for MS is that if the turbo failed to prolong the life of the 360, they'll have wasted money on R&Ding the new innards. The cost per unit is alleviated by the fact that they don't have to do a price drop.
The rewards for a turbo are:
1. Additional users, like me, rebuying the console to play Halo 4 and select titles at 1080p/60fps.
2. Re-invigorating 360 like the Slim and Kinect did, and thus keep momentum going until when the successor is released.
3. Force Nintendo to compete with a potential cheaper platform that has arguably better graphics, HDD, and Kinect.
4. Force Sony to compete with a cheaper platform that has graphics that's still relevant. A turbo would have over a teraflop of power. I doubt Sony would be able to achieve anything over 4 teraflops in 2013.
5. Insurance in case the market for cutting edge console collapses.