Great paper. Clear, concise and very informative.
One question.
1) It is understood that Win 8 supports Win7 applications in Desktop mode - how does this work in practice? Does the user switch from one mode to another (Desktop/WinRT-Metro) or do the applications run seamlessly together?

Yes Richard, when a user runs a desktop application the OS runs the application in a "Windows 7" style shell. There's a task bar across the bottom, with a system tray, etc. All desktop apps run in that same desktop shell.

As a result, all desktop apps effectively run like they do today - with access to the same OS features and desktop model. The benefit is that there's no friction - those apps just keep working as they do today, because they are running in what amounts to the same environment.

The downside is that it is very clear to the user when they are running a desktop app as opposed to a WinRT app. There's a striking visual difference between the two shell environments from a user perspective.

This is why I am of the view that everyone will want to write WinRT apps in the long run, because users will fairly rapidly start to identify new/modern apps as different from old/desktop/legacy apps - and that'll create at least some pressure to move to the new environment over time.