A lot of these video theories (conspiracy and otherwise -- decode chip in cable, etc.) can be put to rest by noting that video output works on the 3rd-generation nano (that's the new one) using the s-video port on Apple's iPod Universal dock. In this case, all you need is Apple's existing iPod Universal dock and any generic s-video cable. I think I purchased my iPod Universal dock six to nine months ago and it works just fine for connecting my new iPod nano to my TV.
However, people who have the Apple AV cable that connected through the headphone jack can forget about it working with the new iPods. Video is now available only through the dock connector so you will either need the iPod Universal dock for s-video output, or one of the new AV cables from Apple that attach directly to the dock connector on the iPod.