The Moby Tablet, a potential "educational game-changer", as Larry Dignan put it, is a device that's right up my alley. Marvell already gave us the hardware technology behind the Tonido Plug, so I'm quite confident that this little device will not only come to market, but will probably be a great piece of hardware that OEMs will be able to leverage in educational and consumer markets.
It's going to be running Linux. Now I love Linux. I use it for my web servers, all of my thin clients have a light Linux OS, and whenever I can get someone to give it a shot on their own computers, I hand them a live CD. Ubuntu will be the only way that these little tablets will be able to run on the Marvell chipset and the only way to hit that $99 pricepoint (or, for that matter, a sub-$200 pricepoint). The Flash implementation that Rachel King reported rules out Windows 7 Mobile as well.
So Linux it is (and I say Ubuntu because that has been well-developed for embedded applications and runs the Tonido Plug quite handily). The problem with Linux is two-fold: 1) Most people don't like it as much as I do and teachers will be put off by "something different." 2) Development efforts in interactive ebooks are favoring the iPad and Microsoft slates, not Linux-based devices.
While most folks don't realize that their Kindles and other e-readers are running Linux, they expect these devices to be "different." Over and over, though, I've encountered users who expect a computer-like device to either look like Windows or look like OS X.
I'm not saying that the product is doomed. On the contrary, Linux development is proceeding at a rapid pace and users are increasingly being exposed to computing devices (e.g., smartphones, e-readers, etc.) that provide a lot of functionality without being "Windows" devices. However, I think that this particular device may have a tougher battle to break into the mainstream than its price alone would suggest. When we can get review units in hand, the features, usability, and price will all need to be compelling.