hmmm the major causes of data loss are not viruses or OS upgrades, these are the most rare occurances. Most common are user stuff ups and HD failures.
Really depends on their OS and level of self-inflicted system abuse, IMHO. In their case it was a poorly protected installation of XP.
Did you even think of using recovery software to get the loss data back for your family??
It was weeks/months before I even heard about the problem having occurred. I have recovery software on my Mac (needed it for a corrupted memory card once and it worked great) and would gladly have tried to recover the digital photos if nothing else, but by the time I heard anything had happened the computer was replaced by a brand new one and the old one given away on Kijiji.
I also hope you realize that backups do not recover 100% of your data, unless you are anal retentive in doing a backup every 30 min. If you do a weekly backup, and say your HD fails 5 days after, you have just kissed away 5 days of data.
Standard Time Machine backup interval is 1 hour which covers most people adequately. I have mine turned down to 3 hours since I found hourly backups overkill, but at the very least I have onsite an offsite backups that are never more then 24 hours old. If I'm doing something that requires more frequent backups (DV editing on occasion in my case) I'll turn that interval down, or make frequent saves to an external drive, or if I'm being extremely anal that day, two.
All that aside, any standard Time Machine operating it right out of the box would never have more then 59 minutes of lost data in the worst case scenario. For your average user, that's more the adequate.
Anyone running mission critical data is probably already backing up in a far more rigorous method than Time Machine anyways - onsite, offsite, RAID, etc..well, unless you're *cough cough* Danger.

(Sorry, OT, but couldn't resist)