I agree that whether or not M$ bundles a media player with the OS is by itself, not a big deal. One of the more problematic aspects of what M$ has done is that it claims the OS itself is basically rendered "inoperable" if they DO NOT include things like IE or the Media Player. This is just plain wrong, and if it isn't, it is further evidence that M$ is selling crap since a first year computer science student understands why there are layers in software and why you separate 'system' software from 'application' software. They make those claims because they know the average user will take to whatever is already there and will not bother to explore alternatives from competitors.
I don't personally know anyone who has actually bought a $499 computer from Dell (or anyone else). By the time they they throw in all the other add-ons required to make it even a marginally desirable system, they spend considerably more. The '$499' figure just helps promote the myth that PCs cost far less than Macs.
I'm also interested in your assertion that M$ has made a lot of good innovations in technology. Everything I have ever seen M$ do with regard to technology turned out to be a bad "knock-off" of some existing technology. In most cases, their attempts yielded that was not as good/reliable as the original, or was "proprietary" and closed (would not operate with the existing item).
I make software for a living and I just find it very hard to have any kind of respect for M$, what they do, and how they do it. I hate that they have made so much money by pushing "crap" to the masses, and to a large degree, convinced the public that it's OK and that is just what should be expected when they use a computer.
-- Mr_Ed steps off the soap box --