It's called the Cricut Create! You can cut down to quarter-inch size and do quite a bit more things. It's exclusive to Michael's.
Right now, Cricut is giving a free cartridge to anyone who buys the Cricut Create and the Cricut Jukebox!
(No, I'm not getting one, since I already have my Cricut, but for those that don't have one yet, this looks pretty awesome.)