Great post from Channel9 with video about Windows on ULPCs, like the Asus Eee:
How does Windows perform on ultra low cost PCs with less than 2GB of storage? Mark Light and Bohdan Raciborski from the Unlimited Potential Group discuss the challenges and opportunities with flash-based storage and getting Windows XP and Office 2003 up and running—surprisingly quickly—on this new class of devices, including the Asus Eee PC. Today Microsoft also released design guidelines to help hardware manufacturers enable a quality Windows experience for this emerging class of low cost computing machines that will help to democratize personal computing by providing a powerful and full version Windows-powered device for low income markets.
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