Microsoft will no longer security update Internet Explorer for anyone who does not upgarde to Win XP service pack 2. I can't imagine they won't have to change that policy. They're abandoning maintenance, of what is probably the single most used application on most systems (the one they claimed in court was an integral part of the operating system), on 50% of their installed base with that move.
It seems what they're really saying is

Don't use Internet Explorer
Demand of you e-bank and all the other web applications you use, that they work properly in standards compliant browsers.

If IE is an integral part of Windows, as Microsoft claims, then they just said "we're no longer supporting Windows 2000". Microsoft's advice could also be seen as another statement: "Don't use Windows".

I think on the other hand that this article is right. It's not malice - just incompetence. Or, incompetence is probably too harsh - I know I wouldn't want my software to be given the scrutiny of 10000 security experts and evil hackers. So let's say "inability to retroactively deal with the lack of designed-in security"
I think this also fits into Joel's continuing story of a change in Microsoft's way of thinking from a customer focus to more of a tech focus.