Where i'm working at the moment, doing software development, a lot of the machines are still on Win NT, and like I said, my Dad's on Win 98.
Where's the value proposition for the upgrade? If I upgrade my PC ($1000+), buy Longhorn ($300?), upgrade office ($500?), get broadband, and upgrade who knows what else, i'll be able to do my email, surf the web, and use office. It might look a little prettier, and there's a chance it'll be a bit more secure, but it still does the same thing. Unless there's a really huge benefit, people just won't bother to upgrade.