* the DS can display a still, R5G5B5 (15-bit) bitmap picture. I wouldn't rely on this for the core game, but any "extra material" can be drawn without worrying about tiles, colour counts, etc.
* you have got 128K ram, for sprites, and up to 64K (1024 tiles) per layer in tiled mode. You can decide to "freeze" the VRAM content at the level, but technically, the device has the guts to update most of those data through the game. That means you could have 128 different 32x32 sprites on screen and keep updating them from main memory. Same for tiles: a game such as Harry Potter just use VRAM as a cache of a larger tileset. Since the screen never shows 1024 tiles, you can always reprogram those off-screen tiles as the scrolling goes (unless you're aiming at a Sonic-paced game).
* oh, and you've got both 16-colour, 256 colours and 15-bit sprites. With up to 16 different palettes for tiles and 16 different palettes for sprites.
So as far as 2D is concerned, the DS can handle virtually anything you can throw at it with 256x192 and only 31 levels per color channel. I cannot contribute to a description of its 3D specs ... yet.