No, I meant SP 2. SP 3 is good too, but brings a lot of unnecessary crap such as WMP 10 (or is it 11?), while I think 9 was the best of all. Well, at least it let me downgrade WMP =)
Windows 7 is another attractive alternative for netbooks, since XP doesn't support nVidia Optimus. I guess, in the end it all depends on your hardware =) If you have a gaming rig, use 7, if you have a netbook - XP for older models, 7 for newer ones.
BUT there's no place for cloud computing on ANY hardware, until we all get 24/7 free 1 Gbps+ Internet access. And even then, I'd keep my stuff on my HDD, since I don't see a reason why it should be anywhere on the net.
And what's that bit about hackers? I do nothing evil with my netbook, apart from leeching my friends' Wi-Fi sometimes =) Unless you mean a *primary* meaning of the word "hacker", which is by now forgotten and used to mean simply a power-user of some kind.