I suppose the antitrust stuff might simply have been too big of a distraction to allow enough focus on early mobile platforms like the Pocket PC, which could have been a much bigger competitor to Palm than it actually was.

But that still really would be the antitrust suits themselves since 1) MS got themselves into that mess in the first place and 2) Bill Gates shouldn't have let it distract him so much from potentially vital projects. 3) employee accounts of the internal politics at the time pretty much meant that most new products were doomed to fail from the outset if management on the Windows teams thought they were even the least bit of threat to them.