Precisely why Apple won't enter that market.
This is true to one extent and to another extent I don't think this market is within apple's laptop scope. Especially considering pricepoints and the recently released macbook pros.
It's not a very practical product as is.
I imagine the attractiveness of a netbok to Apple is that it is an addition. You can have a laptop or desktop (probably not both) & a netbook & an iphone.
If it is a non cannibalising category, then it's right up Apple's game. They know & love small. It's another opportunity to brag about OSX as Windows isn't right for these. Most importantly, they know & love out-of-the-box.
There's a real market for these. It's certainly not the giant hardware guys that created it. They're supplying happily enough, but it came out of the margins. Microsoft sure isn't pushing it, these are a nightmare for them. Linux isn't working out. Who's left?
Cheap is part of the job description here. Cheap, small & out of the box. Apples is very good at 2 out of those 3. It's also another in for selling full Macs.
And Windows is gaining this ground with a 7 year old product that isn't suitable for this job. All the while cursing every sale they make. They're not exactly gung-ho excited about making brilliant netbooks. But they're still taking over.
If no one challenges & the demand persists, MS may eventually actually come out with some Windows that is suited to the job.