In my opinion, I think that the second generation will still be running iOS4. Slightly just a guess, but Apple just released iOS4 for the iPhone. So I think that when it comes to the iPad, they will stick with it for another 1-2 years.
What I could see coming next year:1. Higher Resolution Screen?(maybe, if it got to HI-Rez then it could look annoying)
2.iOS4? (I am kind of doubting that they will actually develop a "Snow Leopard" like OS on the iPad any time soon)
3. Camera for using Face Talk (WiFi and 3G)
4. Performance upgrades (faster processor, better graphics, but the iPad is already plenty fast and speedy and the graphics are very nice for its size, from what I've seen from videos and using the iPad product at Best-Buy)
This is coming from someone who doesnt have an iPad yet(Should have it this week or next week) but I have watched many videos and used it a few times at Best-Buy. Until I actually get the device I can't judge it too much. For now this is all I can say.