The Wall Street Journal is weighing in on Dell’s rumored smartphone offering, adding further weight to rumors predicting the PC maker will enter the arena to take on Apple’s iPhone. Palm and several other companies have released plans for their own iPhone killer.

Citing sources familiar with Dell’s plans, the financial paper reported the Round Rock, Texas-based company has an office in the Chicago area where a group of engineers have been working on the phone “for more than a year.”

“They produced prototypes built on Google Inc.’s Android operating system and Microsoft’s Windows Mobile software,” said the report.

One model has a touchscreen with no physical keyboard, like the iPhone. Another is a slider-style phone with a keypad that slides out from beneath the screen, like the Pre. The report also notes Dell’s recent hiring of two former Motorola employees as further proof of plans being hatched.

It would be curious to find out if Palm or Dell can eat into the iPhone’s market edge. Our guess says no, but you never know these days. The G1/Android has already failed quite throughly to do so, so the new kids on the block will have to do something special to accomplish the feat.