I don't know much about Windows Embedded Standard (what Microsoft officially calls its modular embeddable cut-down version of W7, also known as "MinWin") vs. Windows CE, but Microsoft for whatever reason still chose to base Windows Phone 7 on CE instead of Standard, indicating that they still don't think Standard is appropriate for mobile devices. Probably they will port it to Standard eventually, but they haven't yet.
MinWin is not a "cut-down version of W7" - it was never productized, only a concept demo. Regardless though, Vista had started and W7 continued better separation of layers in NT. Maybe Vista was a percieved disaster, it was a necessary step nontheless.
An interesting excerpt (iirc, Eric demoed this in a Channel 9 video):
In October 2007, Eric Traut, a developer at Microsoft, demonstrated a self-contained MinWin system, made up of about 100 files, on which a basic HTTP server was running.[10][11] Traut noted that MinWin takes up about 25 MB on disk and has a working set (memory usage) of 40 MB. It lacked a graphical user interface and is interfaced using a full-screen command line interface. Traut explained during the demo that MinWin would not be offered as a stand-alone product, but would instead be used as the basis for future operating system releases such as Windows 7.
Wasn't it productized as Windows Embedded Standard? (in its minimal configuration)?
I must admit I've never seen this stated anywhere official, I just assumed it based on the fact that the minimum footprint for WES is 40MB, which was the same figure quoted for MinWin.
