The question on my mind is whether native development will continue to be the favored means of development on mobile platforms or if it will fade in favor of the browser as native development on the desktop largely has. Also is Silverlight's future hitched to the success of WM7?
It will, they just focused on UI and development ecosystem first and I'm sure the updated mobile IE will be a derivative of IE9 which isn't complete yet.
My theory is they wanted some way to get a bit of return on investment from WPF and thus WPF/E which became Silverlight. In 2007 or so who was to know that Apple would have the clout to almost singlehandedly drown RIAs in the bathtub.
Proprietary client side solutions don't make any sense with the advent of what is being called HTML5. Apple's refusal to support RIA platforms on iOS is just accelerating their demise.
XP, for example, has some level of support into 2014, so from a business perspective one can trust that they'll provide support for quite some time, that is something you won't get from Apple. How this has any bearing on a discussion of Microsoft's consumer relevance I am not sure.
As pointed out the Zune lives on but I think it'd be difficult to argue it really made a substantive splash in the market despite arguably being a superior device as well as having the (imho) very strong Zune Pass subscription service. We're four years in and I can count on one hand how many people I've known that owned a Zune. There are parallels with WP7 launch but the stakes are much higher this time around because the relevance of the desktop is waning for general consumer use and Microsoft needs something to replace it. WP7 is an inflection point, if it fails I think you'll see Microsoft go roughly down the same path IBM has as far as consumer relevance (unless perhaps they turn Xbox Live into a OnLive-esque games as service thing, which they are in a better position than Sony or Nintendo to do).
I'm more inclined to think the phone will fail for the same reasons the Zune did, too little too late. But then the media player market was much broader and more saturated in 2006 than the smartphone market is now so maybe it won't play out in the same way...