It's the applications, stupid.
The first time Joe Newbie tries to open a Shockwave web page, send an OpenOffice document to his buddy (who uses MS) that opens with crapped-up formatting, or tries to connect to an Exchange server (and no, OWA light is not a good alternative), he's going to have a bad taste in his mouth.
Badly written or no, the majority of the desktop/laptop world is using closed source products that are largely designed not to play well with anything else. Add to that teams of developers on the closed source side who are paid to iron out the nagging little bugs and quirks that make the (G)UI experience uncomfortable to the end user, but that most open source developers aren't interested in dealing with (it's not an itch they need/want to scratch). I don't know how open source can compete with that.
From Sharp minds come... pointed heads. -- Bryan Sparrowhawk