I understand your point, in terms of OS support the 1,1's life is coming to an end.
But what's funny is, I sit down in front of mine and it still copes with everything I throw at it. I've made a few upgrades recently, and at no point do I think, man I really need a new computer.
Really, the only reason why it is not supported is that the two video cards that it shipped with, the ATI Radeon X1950 and the NVIDIA GeForce 7300 GT all have things preventing them from seeing driver updates. In the case of the former, AMD has completely abandoned users of all ATI X1xxx series cards/GPUs, which is why there aren't any Windows 7 drivers for those cards and why Apple doesn't support running Windows 7 on Macs equipped with those cards via Boot Camp when they would support Windows 7 on Macs with the theoretically weaker Intel GMA 950. With Snow Leopard and Lion, I imagine they were able to get away with reusing the same driver that these machines had from Leopard (if not Intel Tiger), but with Mountain Lion, they are not. In the case of the latter card, NVIDIA and Apple have always had problems with the Mac drivers to this card, so it's no wonder that Apple is abandoning it.
That being said, I see nothing about the GeForce 8800 GT (which was a standard card on the Early 2008 Mac Pro and an upgrade for the original) negating support for the original generation of Mac Pro, which is weird, because I feel like Apple could then say "we support the first generation of Mac Pro in Mountain Lion, but only with this video card installed". Maybe they just wanted to make things simpler. Still though. I feel like any limitation preventing the first rev Mac Pros from running Mountain Lion has nothing to do with the speed of the hardware that is doing so and more to do with things like drivers.