@CoreySanders: Azure is indeed all you say, but the way in which it's marketed and advertised seems to be the root of the many misconceptions and assumptions people have about it. I'm sure that as part of the Fabric Controller team, you have been asked questions which are great dreams and goals for people to reach via the technology they create, but I can imagine how grinded you feel for explaining an equivalent situation in which makes their vision feasable. As engineers, the "sky" is the limit and only limited by our imagination and budget, but the expectations of Azure are usually a little excessive for many people, and overestimate its ability until learning of Azure's domain(strengths & weaknesses).
@aL_: I think Azure COULD probably be retro-fitted to a general hardware configuration if and only if they restore the origional kernel of Server 2008 R2 + Azure extensions instead of using their extremely stripped down kernel which they have engineered specifically for the hardware in their datacenters for apparent optimisation. If the kernel wasnt so specialized, and they didnt design pieces of the intergral components as being so specialised to their specific server configs with assumptions in hardware ability offering the same functionality, they shouldn't be limited by their datacenter configs. But maybe by vendor lock-in decision, they will never actually offer a more maleable Azure for corperate installation, which is sad but not impossible.