Nokia becoming a WP7 OEM does not make them relevant. They're going to go the same path as they would have had they gone with Android instead: just another phone OEM.
Though between WP7 and Android, WP7 is probably a much better choice for them.
With Android they would be competing to differentiate themselves from high end Korean makers and a bunch of cheap chinese makers - based on what?
Also, given the relationship between Elop and MS, there can be some shared resources to make Nokia the flagship for WP7. With Android, they would have been just another manufacturer.
On Android, Nokia would've had no say in anything - being in the company of juggernauts like Moto and Samsung. They'd have trouble differentiating their UX from anyone else's, resulting in the commodification that Samsung, LG, and Moto are facing now. They'd be stuck in the same position as all the OEMs now: a UX they don't control, branding diluted across your competitors, and relegated to shipping crappy UI tack-ons in a desperate attempt to differentiate your Android offering from someone else's Android offering.
The WP7 launch hardware has been disappointing so far - build quality is middling, and resembles far too much like the hordes of Android phones out there. MS would do wise to tie WP7 tightly to Nokia - who have in the past created some of the best hardware in the entire industry (design and build quality inclusive).
If all they do really well is hardware, and both platforms are available to all OEMs, why not go for the more successful one, especially considering that WP7 is proprietary so MS can decide to play hardball with them at any point.
My own opinion of Nokia is that their classic line of phones had by far the best software, and while initially it had better hardware, that lead narrowed considerably pretty quickly. Yet that software was very good because it was an extremely feature limited and highly resilient phone OS. Nothing modern is as good at being a cellphone as a classic Nokia. And as the iPhone conclusively demonstrated, that doesn't matter these days. Symbian was a disaster and Meego seems promising but behind. They really lost a great catch in Palm, and I'm not really sure they'll be able to differentiate themselves as a hardware builder on any platform for that matter.
My weekend coach suggestion would be to take a leaf from the iPhone playbook and release only one phone every year or more, that has the best possible industrial design you can muster and that gets timely updates to a vanilla version of Android, properly tested and integrated. If you want a low-end model just tweak the previous year's high-end model and sell it cheaper (think PSOne).
RIM / Blackberry have most of the business market at the moment.