Has everyone here forgotten that Microsoft and Linux aren't the only games in town? There is also Mac OS, which has a small but growing market share and poses more competition to Microsoft than Linux does. So get over the paranoia. Microsoft can't take over the world as long as the Mac is around. People have ALWAYS had a choice as long as personal computers have been around. They've chosen Windows by a large majority. Sure, you can argue that they didn't really have a choice because most users are not knowledgeable, they don't know Linux exists, they're used to Windows, probably use it at work and school, they think their operating system is Microsoft Word, and all the computers they see in the store come with Windows installed. But if people really felt under Microsoft's thumb, they had every opportunity to get something else--the Mac has been there, they've heard of it, they can use the same programs they use on Windows, and they can buy a computer with the Mac OS preinstalled.
It was announced many months ago that Microsoft was working on a version of XP for the OLPC. You can't seriously expect Microsoft to pass up an opportunity to get in on this. They owe it to their stockholders. Nick Negroponte was very excited and positive about Microsoft's working on a Windows for OLPC.
I think the ASUS eee and other low-cost computers would have entered the market no matter what. It's not the presence of Linux that enables them, it's the attraction of a low-cost machine that is usable by the masses. The eee is XP-capable, comes with drivers for XP, so we'll see whether buyers are content with the Linux on it or switch it to XP.
There are a number of factors that make this a good time for low-cost computers like the eee and the $200 desktops now available. One is the availability of broadband, which enables the eee to use Web 2.0 applications rather than big locally installed programs. Another is the large number of users whose requirements are mainly Internet, e-mail, IM, photo viewing, and listening to music. For that kind of use, the operating system is irrelevant. Linux has reached the point where it can do those things at least as well as Windows and without a bigger learning curve.
My hope is that the eee and other low-cost computers with Linux preinstalled will introduce the masses to Linux and get rid of the stereotype that Linux is a geeks' OS. You'll never get anywhere by bashing Micosoft. Most people just don't care and they'll probably think you're a fanatic fanboy. But if people get a chance to actually use Linux and see that it's easy to use, looks good, is less expensive than commercial software and OSes, and can do the things they want a computer for, they'll be more willing to take the plunge on their desktop computers, too.
Note I said "is less expensive." I think all this talk about Linux being free as in beer does a disservice to Linux. Most Linux projects are starved for cash. And why is that? Because people think "it's free"--as if developers and the companies behind various distros don't need and deserve compensation. In fact, they can't survive if no cash comes in. So at least pony up the $27 for the Deluxe CD or make an equivalent donation, and if you can't afford that, donate what you can!