You can get some decent netbooks my better half loves hers and it is appropriate computing for her needs, no need to have some quad core piece of s**te for simple webbrowsing, basic coding and latex document writing (easy peasy ubuntu is the way to go - Si, if you still have your eeepc install this -http://www.geteasypeasy.com/ - much better than the default one, you might even like it!)
I think M$ have more to lose if Windows 7 bombs like vista more than they have to worry about Google or linux - though its probably different in the corporate world than the home... if more corporate clients move to linux desktops then they would be more worried (and not just servers). Personally I'm a linux-head but you know what I don't mind if people don't see the light... means I'm more secure.