Apple TV is an experiment. They're trying to find a market fit, so to speak. If you're comparing anything Apple is doing to an existing product, you're looking at it the wrong way.
Agreed, and at the $99 dollar price point, you can tell they're trying to make it work. Unfortunately, I don't know anybody technical or non-technical that would enjoy it.
the market is already there, every iPad, iPhone, and iTouch owner will get one. God its cheaper than an iPod nano.