I already linked to this, first clued in by a reader named John, but people are missing the link: there's a picture on the internet of a Panasonic G1 under glass with what looks like a mock-up of a "pancake" 20mm ƒ/1.7, said to be coming next year some time. The picture seems to have originated on digitalcamera.jp and you can see it here.
This looks like a mock-up to me, rather than a prototype. The lens has no filter threads and it doesn't look like it has a full complement of actual elements in place. That doesn't mean the final product won't look exactly like this, but for what it's worth I personally don't believe this is an actual prototype.
But, just in passing, bravo to Panasonic for planning this lens!
Another thing to bear in mind: The Panasonic G1 is the first Micro 4/3 camera, not the last. No need to bemoan the size or the feature choices just yet. There are going to be more cameras in this standard, even if it doesn't take off. If it does take off, there will be a great many more.