I've stood out of this debate as I do not believe in my ability to predict the future. However, you are now making a dangerous argument that cannot go unchallenged. Mr.Roddey has made a convincing argument elsewhere that stripped down XP can be a capable backbone to a control system but it must be left alone in the back ground to operate by itself. It has to be closed down. It needs to be closed down to applications and viruses. But you are preaching about putting a MS OS not in the back ground, stripped down and free from any applications to one that is a quasi-server--but not quite--and susceptible to every possible virus and ad-ware attack some Eastern European 15 year old suffering from anomie can dream up. Of course it's cheap. You've developed nothing but an application and a skin. But this is not a car where you have full control of the manufacturing process. This is a control system running people's homes and you are suggesting a control system paradigm where the back-end control system is the same as the front end DVD/music server?!!! Other than gas and oil what can you put in a car. If you don't close Windows down you leave it open to every possible attack known to man. FYI, my brand new laptop just stopped running crucial software after 1 week. And you'd leave that system's architecture unprotected and open to attack?
Even your example of XBox is suspect. That too, is a relatively closed system, save for the game developers using the SDU. But you are leaving opened ended Windows, completely vulnerable to attack, without any systems engineering for any UI. If this is how you hope to reach the high end then you will go the way of Phast and C4. Crestron has already lowered the bar with the Adagio and it's entry price is half of yours. That includes a pre-engineered system that takes 15 minutes to program. AMX has made purchases that suggests that it too will be entering the entry level system's integration market. These are companies with both the engineering talent, the marketing power and the experience. What would have happened to CQC if Dean Roddey had only the financing to hire a high powered marketing firm? At least his system makes sense and I have problems with his system's integration as it is purely a software based solution that depends on third party hardware upon which he has no control ( touch panels, not the PC ).
Everyone wants to go after Red State value consumers. But I'll promise you this. If your paradigm is to suggest that the same HTPC or media PC that will act as the front end source also serve as the back end control then you are a snake oil salesman. Enterprise servers have a different topology and Microsoft is even marketing a stripped down version of these enterprise solutions. So why would you wish to suggest, what Mr.Roddey has here suggested is a bad idea, that Mr. and Mrs. RedState, who value reliability as much as their bank account, follow a typology that has been proved unreliable? Because you have a horse in this race? I understand why Best Buy has partnered with you. They don't wish to commit to the one solution that works. they'd rather sell a pseudo solution that doesn't work. The Tweeter model is what will eventually happen. Centralized integration by programmers for the national chain, running on a reliable hardware and software. It may be Lifeware or life support but it will not be the hardware typology you've suggested.
However good your software application, I will promise you this. As long as you permit your application to run on an open source open ended architecture it will fail as a control system. It will be bogged down by applications ( as in anti-virus ) by DVD burners, by virus and spyware attacks.
"This is a Christian Country,Charlie,founded on Christian values...when you can't put a nativiy scene in front fire house at Christmas time in Nacogdoches Township, something's gone terribly wrong"