Earlier quoted context omitted.
Before the iPad, Microsoft was using the "PC interface", to the disadvantage of the tablets they were putting it on. Now they are doing the reverse: making a tablet interface to the disadvantage of the PC. The "all-in-one" interface for all types of devices and form factors will never work, because at best it's optimized only for one of them, and mediocre or poor for most of the others.
They could have so easily gotten around that by just calling it "Metro" and doing a clean break. Then just promise everyone that windows isn't going away and imply that there will/might still be a windows 8 which would be a continuation of windows as we all know it for PCs. Then all the ARM devices (phones, tablets, etc) and also XBOX uses "Metro". Just Metro, no mentions of Windows. If people like it, THEN windows 8…
The key for Surface is the integration with AD, with providing a "desktop" of sorts, and all the other bells and whistles people associate with Windows. Whether the Windows DNA can be successfully combined with a touch based interface is a problem, but at least MS is trying. Muddling along with their old-style tablet software would cede the market to iOS and Android.