SGI wouldn't have been able to manage that business as well as Sun did; at least the E10K was successful somewhere.

This is absolutely true. SGI was trying to decide between shutting down Cray BSD entirely or shunting it off to Sun -- who was really the only possible buyer (their product was based on SPARC and Solaris, even when at Cray). So SGI wasn't going to make a nickel off of that product, and as such, it remains one of the best acquisitions in the history of the industry: purchased for less than $10M (I'm not sure the exact figure was ever disclosed), that product line did $1.2B in top line in its first year at Sun -- and it's hard not to have fond memories of that year. (Speaking personally, debugging a nasty performance problem on an E10K in December of 1997 helped to directly inspire DTrace[1]; I will always remember that machine fondly, despite its many quirks.)

[1] http://queue.acm.org/detail.cfm?id=1117401

Right. Selling to Sun was the right thing for getting some nice hardware out there. Just saying, it gave Sun quite a competitive edge - probably bad idea from a business perspective. I was at Sun in that timeframe too, but not working on the E10ks :-)...

As if it helped Sun (in the long run, I mean).