I wonder how much of those costs go into Sense, Motoblur, Touchwiz, etc. Shipping stock android is surely less labor-intensive.
That implies that Windows Mobile doesn't require similar in-house effort, on top of the OEM license fees. Windows phones still require the same hardware driver development effort, and WM7 is already starting to receive the carrier-bastardization treatment. I'd say Android's licensing being free is the only difference.
Android OEMs have to develop their own drivers to get the various components (screen, GPS, WiFi, Bluetooth, 3G radio, accelerometer, etc.) working whereas with WP7, Microsoft will provide all the device drivers. Part of this can be attributed to the fact that Android devices have a much wider range of hardware options, so it's a lot more difficult to have an uniform set of drivers.
Microsoft did a tonne of heavy lifting to make it so. There were boxed in drivers for virtually everything, and customization was absolutely minimal.
And when you bought a MotoQ, it was stock CE.
I haven't coded anything for Windows CE, but making a Silverlight app for Windows Phone 7 is about a difficult as making a WCF app for Windows, or an ASP.Net app for the web.
Dell has suffered the same outcome for its entrants into the Android field. Clearly they were trying to enter the market on the cheap and it hurt them.
Aside from simply having technical insight into the individual ROMs, you needn't look further than the disaster that has been Sony Erricson and Dell's Android entrants to see the truth in this -- those vendors came out with devices running dated Android versions, turning possible winners into catastrophic losers, eviscerating sales of the Streak and X10.
If they could have just done a merge and they were done, obviously they would have.
So now we're getting to the point where it seems that makers like Motorola and HTC have started to build up a significant Android talent pool, and that bodes well. Despite the constant incantations that Android is free, I wouldn't be surprised if the in-house development costs rivaled or exceeded what something like Windows Mobile cost to license.