Then they'd invite us for the after party, and we'd blow all the money we made from hotdogs on drinks, get them drunk AND get even more information about the conference.
or hack the anybots robot's webcam feed
Edit: This is of course assuming that there will be a Startup School in 2010 since it hasn't been announced that I'm aware of yet.
The extra events are certainly a nice perk, but the main focus is definitely bringing something to market that people want.
People can create a startup for lots of reasons- Wanting to change the world, wanting to make a lot of money, wanting to disrupt a market, whatever they want. That's great. I wish them well.
YC is one way to get things started. It provides a pittance of money- $15K isn't really enough to fund substantial development, but it's enough to help build momentum.
The biggest thing that YC does provide is Networking and advice. Meeting with PG et all is a great way to get good advice on how improve your product, and how to handle the trickier aspects of running a company, such as buyouts, raising additional capital, and the like.
But beyond working with the YC staff, one of the other really nice advantages is working with the YC network. There is an ever increasing group of people who have gone through the same process you are- Who know a lot about what you're doing, and often have Great advice on what to do next.
To my mind, they're one of the best reasons to join YC. The problem is, like everything else that YC is facing right now, it needs to scale. Kn0thing can't meet with 400 founders to discuss the sale of Redit to Conde Nast.. While it'd be great, that'd be his new full-time job.
Holding a conference allows him to tell the same story once, and have everyone hear it. He can take questions, and answer them for everyone, rather than having 25 people ask the same variation of a question over and over.
So to your main point- I love the conference idea, and I think it's a great value-add to YC. People might do a startup for any number of reasons, but this increases the value of YC being a part of yours.
YC is becoming a similar institutional organization, where membership provides value independently of the reason for membership. That has interesting implications, as pg has said that Harvard/Stanford/MIT YC applicants statistically do no better than others. I would be very interested in a comparison of YC's output to similar programs (TechStars) to see if YC has succeeded in attracting / developing a statistically "better" population, or if YC membership benefits are being squandered on an arbitrary few.
There is a benefit to having a trusted crowd, but there may be a better way to decide who is "in". OTOH, it is good business for YC to nurture companies that it has invested in.