I wonder if it could also be a rear-guard action. As they focus on 'post-PC' devices, PC enthusiasts might be drawn towards desktop Linux, which is still relatively PC-centred, despite what some people claim. Game shops like Valve are already looking at Linux.

But Microsoft can still make a lot of money from traditional PCs. So if this move delays Linux getting a foothold in that market, it's worth it for them. I guess relatively few people buy the full retail edition to install themselves, so cutting the price for them won't hurt much.