It may not be as obvious now, but at the time, IE often offered a better experience for both users and web developers.
IE tended to be faster and stabler than its competitors, and releases like IE3 and IE5 offered a number of innovative features and technologies.
IE coming with Windows clearly didn't prevent a large number of users from switching to Firefox once Firefox started offering a better experience, and then to Chrome once it started generally offering a better experience than both Firefox and IE did.
I would say that the turning point was when HTML 4 adopted a lot of things based on the way IE did them rather than Netscape (e.g. <div> + CSS rather than <layer> etc). By IE5, if you were on Windows, you pretty much had to be a die-hard Netscape fan to keep using it.
AFAIK The Mozilla project (initially started by JWZ) started when Netscape made its browser open source. The reason for this was the loss of market share due to free IE. Firefox came a few years later as a spin-off from the Mozilla Application Suite. Mozilla/Firefox's popularity correlated with Linux's because we needed a good open-source web browser on Linux (and BSD), not because she saw some opportunity to make an open web possible.
> No, she didn't write any code, but she is directly responsible for forming a company that enabled Firefox to be free and open source.
Unlike Brendan's role (excluding javascript), she had a small part, but I would not call it significant.