It would take very little to fix the Windows 8 issues for desktop users and sophisticated uses can do it themselves. But yes, Microsoft's approach to the Windows 8 UI was subpar.
I personally prefer Windows 8 to Windows 7 and Windows XP but I can navigate around the stuff that changed for the worst. It's obvious that Microsoft wants to nudge people to their Modern UI but I think that a lot of people that aren't tablet users won't want to use Modern.
This is not good news for Intel's tablet strategy.
It's also not clear to me at all that Win8-based tablets are gaining any mindshare. It's all about iPad, or to a lesser extent Android tablets on the lower end of the pricing scale.
Forget Otellini, the real problem here is Steve Ballmer.