At the Game Developers Conference panel titled "Inspiration Behind Nintendo DSi Development," Nintendo's project lead Matato Kuwahara revealed that there will be a variety of ways to distribute Nintendo DSi software to users, both digitally distributed as well as via retail packaged software.
The first way is, obviously, through the DSiWare Channel where game developers can create small DSi concepts for small or no cost to the consumer, and have them downloadable straight to the DSi internal memory.
Via retail, developers can choose two routes. DSi Enhanced Game Cards will give developers the ability to incorporate DSi features, such as the camera or the SD cartridge, into their DS games. These Enhanced cards will play as standard DS games on the Nintendo DS or Nintendo DS Lite but will only open up the unique elements of the DSi on those consoles. Kuwahara used the idea of bringing in pictures taken with the camera and utilizing them as in-game textures as an example.
The other option is DSi Game Cards. Kuwahara recommended this option for those looking to place DSi-exclusive concepts into retail stores. These cartridges will not play on the Nintendo DS or DS Lite.
The DSi Enhanced Game Cards and DSi Game Cards are still being worked on at Nintendo, but should be available in the near future.