In all fairness, they do recommend you upgrade. The new Windows' Security Center should not be the only thing on your computer so it remains important to have third party anti-virus programs, firewalls, and spyware/malware utilities installed. And training oneself to be in the habit of safe computing.
I agree with you. This "Security Center" is designed for morons who refuse to take any steps to protect their own computers. Those who depend on free products to protect their computers are getting exactly what they paid for.
Anyone on this thread bashing Microsoft in this particular instance knows that to have good computer security they have to use the "best of breed" security products. Microsoft provides none of these best of breed products.
Personally, I think this is a step in the right direction. I'm not about to give up my Checkpoint firewall, F-Prot Antivirus, etc. I encourage any Windows XP users who "don't know anything about computers" to install SP-2 and help cut down on the number of bandwidth-hogging zombies out there.