No its not that. They are just going to use a more compact version of the kernel. If they went with just the kernel and nothing more it would be just like the Linux Kernel. Nothing. They have to add on some stuff to be able to use it.
The big thing is that Windows 7 is using the new condensed kernel which in size is only a few MB in size compared to the almost GB size of the kernel in its current state. So instead of having to have a DVD like we do now for VIsta we will be back to CD's. Since the kernel wont be taking up as much room. It will also cut down on the amount of resources used since it wont need to run so much stuff from the kernel as well.
They will still bundle IE, WMP, MC, and everything else like they always do. Come on this is Microsoft Windows we are talking about. they are jsut using a condensed kernel. Everything else will still be there.
