When this was first announced i though I'd finally found my new toy, but once the excitement wore off, I realized that you really weren't getting a whole lot for your money.
At fist glance I though that this would be a great media center PC due to its form factor and dvi output, but once you add wireless connectivity (bluetooth & 802.11), wireless peripherals (keyboard, mouse), a super-drive, and finally more memory and storage, you get a small computer with a much larger price tag (around $950 for the 1.25 ghz model w/o display). Still not horrible for a Mac in the living room, but when compared to other wintel offerings in similar form factors, it just doesn't stack up as a viable solution for the living room or for Grandma.
I'm not saying I won't buy one ;), I'm just saying its not as cool as I thought. For most people looking for an alternative, I would stick to the 17 inch iMac.