I've said it before, and I'll say it again. The crucial failure for this system was that it wasn't ready yet. The tech available in 95 wasn't up to standards. 3D processing tech was in it's infancy, LCD screens were monochromatic, power-hungry, low resolution, slow refresh beasts.
Look at what the VBoy could be today. The PSP and the N-Gage have 3d processing available in a hand held unit, powering an LCD screen as well. Add another LCD screen, and modify the code a bit, and you've got a sleek little machine.
The other problem would be developing appropriate titles for the system. It'd take a year or two of the device being out before devs could really make excellent use of the technology.
But it will never be, thanks to the colossal failure of the Vboy. No company will ever take a risk on a system that would be instantly linked to one of the biggest failures in gaming history.