If the Windows team needs Office exclusivity to compete then Microsoft is in trouble. Love them or hate them, the iPhone and the iPad are everywhere. People on those devices WILL find alternatives to Office if Microsoft doesn't build it for them.
Building a touch friendly version of Office for the iPad has to be a scary proposition for Microsoft. Putting Office on iOS might give enterprises a real reason to look at iPads. I think this is unlikely, but a possibility.
If they would release the touch-friendly version of Office on tablet PCs first, Microsoft might actually create a compelling reason to buy one.
Oh and for the people that love the stylus and "palm rejection" that's great. I have tried to like it on several occasions and I just can't.
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