I know that our cell phones aren't just getting smaller because of more cell towers, but I was just making it simpler for other people to understand my point. But great post, you actually looked past the heat issue of the Macbook air and looked at the bigger picture.
I think we are operating on the same wavelength here
(yes, cheesey cell phone pun completely intended)
With the air, Apple has added a new way of thinking about what makes a computer portable. As to your specific post, it really comes down to what you want and what you are willing to sacrifice. Most companies view the idea of an ultra portable pc as something you can fit in a purse or other small bag and take with you more conveniently. Apple presented us with a notebook that is lighter than crap, thin (and therefore much easier to fit in a backpack or messenger bag), but still gives you the feeling of a regular sized 13.3" computer. Are there sacrifices? OF COURSE!!! But what good doesn't come with sacrifices?
For me personally the AIR is exactly what I need, its like Stevie was crawling around inside my brain and picked out what I need in a computer. It is powerful enough for me to accomplish all of my tasks with ease, is light enough to haul around campus with even greater ease than my old macbook, and is thin so it takes up less space in my backpack.
Is it like this for everyone? Nope, and thats why we have all different flavors of computers. Ones you can drop without too much worry, ones where you can write on the screen, small ones that will fit almost anywhere, big ones that will do almost anything, and all those inbetween. Each presents its own engineering feats, its own design standards, and its own sacrifices.
Now, if we could just get all these flavors with a sprinkle of Mac OSX.
(I hope I haven't gone too philosophical and mushy...)