Sony's brand still carries a lot of weight, but not enough to make people throw away the 95 million songs they've bought from iTunes in favor of Sony Connect. People didn't buy into the ATRAC3 format with the MiniDisc in any large numbers, and I don't see people buying into ATRAC3 with this new Walkman, either. Sony's trusting waaaaay too much to its brand on this one.
For PC-only people who wouldn't touch the iTMS or iPod with a 10-ft pole because they distrust the little they know about Apple, maybe this latest iPod "killer" will have a market. Otherwise, they won't get any more marketshare than they did for the NetMD players.
And yeah, the "x thousands of songs" hype is crap. A GB is a GB. The only difference is what format the files are in. But, I wouldn't be surprised if the average consumer doesn't grasp this.
That said....why is it that practically every other player on the market has more battery life than the iPod? Sony's device doesn't look that much bigger (granted, I didn't ferret out and compare the actual measurements) but it's got a 30-hour battery. What gives?