What counts and doesn't count was clearly stated out in a better article: http://blogs.zdnet.com/Bott/?p=844 In short, a lot of things don't count towards the limit: services, Explorer, tray apps, command prompts, etc. TFA appears to just be a bad (and very incomplete) rip of the piece at zdnet... (which seems increasingly common on /.--quoting from "articles" or blogs that are often incomplete and poor rips of an original article)

Um, where are you getting that? TFA explicitly states that it's targeted at developing nations--places where XP Starter with the same 3-app limit have been sold for years. Microsoft never said that Starter was intended for netbooks, either--that was mostly just speculation by the media.