I agree with the part that X lets you display what is happening on remote machine to your local terminal (virtualization) part. Just sending the bitmaps/buffers back and forth is very primitive (VNC) and does not perform well. And yes, people short circuiting that part just to say that yeah! everything is running on this box only miss that part. on the other hand, X is old and crumbling around and I am not sure about the audio/video etc support for modern devices and hardware. Maybe an X done for today;s world is the answer.

The poster has changed
[Every time you log in to any service that uses a plain HTTP connection that's essentially what you're doing.] to
>>Every time you log in to Twitter, Facebook or any other service that uses a plain HTTP connection and that is not accurate. The Facebook login page uses https.

At work I have a wyse xenith thin client on my desk that I use with Xen Desktop 5 VDI. I use Xen desktop to launch VM templates that contain my development tools like perforce and visual studio. I really do not feel any difference between using my laptop or the thin client when I am on my desk. The only advantage I can see for the laptop is portability.