The rumour mill has been churning up some pretty exciting stuff lately, and here's a bit that seems plausible considering that Microsoft saw no problem with Rare working on DS games like Viva Piñata and Diddy Kong Racing.

Supposedly, the company is in talks with Nintendo to develop games for the 3DS platform, including a 3D continuation of the Banjo-Kazooie franchise. Pleased with the success of their previous handheld outings and seeing no conflict between the Xbox market and the handheld gaming market, Microsoft supposedly sees this as a positive as it could boost sales of their titles developed for Xbox 360. Sources also say that Nintendo and Rare discussed a 3DS continuation of the Star Fox Adventures series, but that nothing is currently in development on that front.

Considering our previous discussion on why Rare and Nintendo should reunite, this could be quite the positive move, and it makes complete sense that 3DS would be the platform on which it could happen.

What do you think about this possibility, and what do you hope to see Rare develop for the 3DS?