Of course, it's also got Nvidia's Tegra 2 inside (announced at CES in January), which we know runs Android or Windows CE and is capable of 1080p and Flash video.
That doesn't sound like a PC. Oh, wait, Nvidia has no x86 license.
There are lots of external hard drives with media playback and network capabilities on the market, yet nobody calls them PCs...
In my book, you need to be able to support a full x86 OS in order to call the thing a PC.
Besides, Tegra is supposed to be a mobile chipset. So why the long faces at the size? It probably also fits a 2.5 notebook HDD comfortably in there. And it must have an external power brick supplying the juice.
No surprises here, but I won't argue the capabilities of Tegra 2, which are nevertheless quite impressive.