I'm sure they were originally hoping for mass-market success, but given the RAM drought and ensuing pricing, I'm guessing the best possible outcome at this point would be to break roughly even and learn, so that they can put out a more competitive revision if and when prices ever return to Earth.

With Windows becoming increasingly hostile, I do think there's room for a hardware/software integrated "just works" offering in the Linux PC space. Plus software pricing is probably a lot more competitive than console (dunno, never had anything to do with consoles, but my impression has always been that hardware is a loss-leader there).