Thank you Mark Shuttleworth and a slight PC/OS update

Yeah isn't it? You know what is fun? Beer pong.

It's not without precedent at all. Microsoft gives Windows for free to students via their MSDNAA program. Microsoft gives a pack that includes Windows and MS Office for $3 to developing countries. Microsoft is perfectly capable of giving away Windows if it serves them strategically. It's in Microsoft's best interests that Windows maintains the desktop, and this goes beyond selling Windows licenses.

The Action Pack would be more popular if it came with action figures of Bill Gates and Steve Ballmer.

Depends how you get MSDNAA. If you go on the website yourself and register they will charge you a $3000 fee or something (this only applies in certain countries). But if your school is served by people with titles as "Microsoft Student Partner", or "Academic Technical Evangelist", even in the USA you can probably set up a deal where your school pays exactly $0 for the subscription. Microsoft would most rather your school pay the $3000 fee, but also, they rather your school be part of MSDNAA even for free, then start using tools like gcc and Linux in CS courses.

If you somehow can't get MSDNAA for free, there is always "Dreamspark" which is completely free no matter what.

Anyway I think I have safely shown that it's not unheard of for Microsoft to give away software for free, especially when it serves their strategic interests. Since writing software is almost entirely a capital expense. Keeping Linux off netbooks is in their strategic interest, they would likewise would give away Windows for free if that would aid in their domination of this platform.