Obviously Ballmer is driven to succeed. I should certainly hope anyone in his position is.
His problem is what Microsoft's problem at large has been for years: image.
Half of MS' mixed reputation (especially in light of Apple) is its uninspiring and mediocre products, and the other half is its management - primarily a leader who is neither confidently aloof nor charismatic. Ballmer certainly attracts attention, though. Most of it negative. He seems to think that having any personality is having "personality." Not the case. Ballmer's his own worst enemy.
Ballmer is notorious for running his mouth and creating completely avoidable snafus. This is made most apparent whenever he says something about Apple, or tries to address all the positive press Apple's been getting. Check out the foot-in-mouth scene when asked about the iPhone. Check him out going nuts over Vista before its introduction, stating how it would blow OS X and Linux out of the water. Yet, it was complete flop at launch, probably only second to Windows ME. And that taste lingered with disenfranchised Vista users. And of course, the "I think the tide has really turned back the other direction" against Apple comment, when Apple's posting record quarters and enjoying among the fewest losses in computer sales despite the recession. And that's continuing into the summer. And of course, we have the "monkey boy" scenes . . .
And hey, just look at most of Microsoft's keynotes: awkward and embarrassing.
Ballmer, like MS in general, simply has no taste.
Indeed, but I meant "extremely driven" in a different way to Bill Gates (& certainly Steve Jobs

). BG would've probably ignored the Apple ads, whereas SB probably sees Apple's ad-campaign attack on
his MS (at least the products) as something he needs to counter in a head-on way, ie. "if you want a fight, you'll get a fight!" He'll probably finance a very long ad campaign until he feels enough damage has been done to Apple's credibility & sales start to dip. I'm not saying that'll happen, but it may do for 2 basic reasons: downhill economy & for many people Windows 7 needs be only good enough, not better than OS X. The problem for Apple might be that if you tell most people something often enough, in the end they tend to believe it & go on to spread that message.
I'm sure many here will agree with your other points (as will Linux users &
some Windows people), I just don't believe your view is representative of how Steve Ballmer & MS are seen in the wider world. Obviously he's far from the deranged schmuck some people like to represent & I think his, & MS's, "lack of taste" is meaningless outside of fairly niche Apple circles.
I expect many consumers & pros will continue to buy MS products bar an unexpected disaster, for eg., Win 7 proves to be as disappointing as Vista pre-SP 1 was, which is highly unlikely. FWIW, I think the greatest long-term danger to MS might be Google, particularly if cloud computing takes off with an online OS along the lines of Chrome bringing thousands of office-based applications. That would hurt MS more than Apple by eating into sales of MS cash-cows "Windows" & "Office". It'll be interesting how all this pans out.
Many buy a PC for its excellent upgradeability. But taking into the account an amount of time the upgradeability costs, one soon realizes that PCs are not that cheap. In fact, quite often are much much more expensive.
Any day of week I'd take an overpriced, but well integrated platform with all advertised features working as advertised over a lego-brick-like platform, eating constantly my time for the obscure maintenance handwavings one has to perform to keep it running.
I agree that when looking at "total cost of ownership", Macs still represent very good value for some of us (hence, I have 2), but until Apple expands their hardware range - by which I don't mean catering for every niche - I'm sure PCs will continue taking some 90% of the computer market, which in turn encourages greater software development for the Windows platform. Mac-native gaming is already a casualty here, with only Feral & Blizzard of any note bothering to develop proper Mac-native ports.