As reported on the MoneyforJam blog, Microsoft is heavily discounting Windows to keep market share in the face of cheaper Linux offerings. Reuters notes:
In a significant development, Asustek said it would also offer a version of the ultra low-cost PCs with Microsoft's Windows operating system, after initially saying that all the computers would carry the open-source, free Linux system. Windows versions of the computer would cost about T$1,000 more than Linux versions [T$1,000 = US$30.00], leading many to say that Microsoft had offered the Windows systems at a big discount from its usual price of T$2,000 to T$3,000 for mass buyers.
So now Windows is worth $30.00. That seems about right. As MoneyforJam notes, XP (which is what ASUS will ship) is now the Vista Poverty Edition.