Xantar beat me to it. Here's an interview with Jim Merrick, that has a lot of good info.
http://www.eurogamer.net/article.php?article_id=60917
Eurogamer: How is the controller going to work with games that aren't designed specifically for the Revolution - multi-platform titles and so on?
Jim Merrick: We're producing a classic-style expansion controller, based on traditional designs like the Gamecube controller. It's like a shell with a hole in the top into which you slot the freehand-style controller, and then you can play third-party ported games, and retro Nintendo games you've downloaded.
So there's that option - but even while it's inserted into the classic-style shell, the freehand controller will still be able to sense positioning and so on, so there are more options too.
It's something that's just as true for the DS - not every game uses the DS's unique features. But some multi-platform titles do, like The Sims 2 for example. We hope other developers will do the same and look at ways their multi-platform titles can make use of the Revolution's features.