My main beef is that they really didn't present much of a vision and future for the 360 past this Christmas. You know Sony and Nintendo will be pushing their 2008 stuff, and it seems really bizarre for MS to get flanked like that.
No price drop was also stupid. You're going to have to drop it in the fall, and going in strong into those months with the media (beating Wii, doubling Sony, etc.) would have played perfect into the hands of the holiday shopper.