Disclaimer: I do not want this to be true.
Why didn't anyone think of this before? It makes so much more sense of the original rumor, and MAY BE something Nintendo would do. At the very least we can bet they considered/are considering it.
Kill physical games entirely! But... why? Well if their next system is rocking a fast internal drive so they can get rid of those load speeds and enable different game design ala PS5, getting a game card to match is going to be pricey, and depending on the speed they want to hit, impossible? Heck current Switch game cards are already too pricey! So this leaves Nintendo with a choice. $70 (or more?) games? They tested the waters with Zelda, seemed to do okay. But they can't do that for all their games, can they? Also with NG development game sizes are going up up up which means even bigger game cards and even more $... going digital only solves it all. They can keep their pricing at $59 for big titles and $49 for smaller ones, WHILE making more profit per game. It's basically pure profit.
Which leads us to the 2 models and the confusing rumor. Actually both models have BC, digitally! Only one of them has a card slot for physical BC. That model is the "premium" model that also has probably a couple other features to distinguish it.