My condolences to people affected by this. 2004 is getting off to a bad start.
Taking account of what information has been released already, what sort of mechanical faliure could happen to cause an aircraft to turn around and head back to the departure airport for an emergency landing, and then crashing short?
The only thing that springs to mind is an engine explosion, leading to severed lines/control surface/wing damage, or fire, leading to the same thing. It would have to be one hell of a fire to only last two minutes airborne. I don't think this is a repeat of the rudder incident, as not only was that fixed, but from my understanding it leads to a pretty much instantaneous loss of control, which I don't think is what happened here.
This of course, is just my opinion.
Are there any eyewitness reports? From my understanding the area around the crash site is a busy tourist resort.
Whatever the cause, lets hope that the French officials are invited to participate in the investigation, I think it would only be fair considering the loss of French families.