Here is how I would recommending making the Linux desktop better:
1) Improve the Control Panel applications so you can make practically all OS configuration changes without having run a command or hand edit a configuration file. If I have to open a command prompt or a text editor to fix a problem, you've made configuration more difficult than what 90% of computer users are willing to put up with?
(And if you don't believe the statement above, consider yourself lucky. You obviously haven't been doing much tech support for "regular" computers lately. The command line scares the hell out of them.)
2) Standardize on a single method of packaging and installing applications. .RPM's, .DEB's, yum, apt-get... It's too many choices for the average computer user.
3) Get some of the major PC game developers like EA and Blizzard to start making their products Linux native. Make those versions available for $5 less than the Windows versions. That will get you some market-share growth quickly!